By Echo Wang
(Reuters) -They hit a record high at the close and the Dow and Nasdaq rose on Thursday as shares of Micron Technology (NASDAQ:) rallied and a strong report on U.S. jobless benefits eased labor market concerns.
Shares of Micron Technology rose 15.78% after the memory chip maker forecast first-quarter revenue above expectations, highlighting strong demand for memory chips for artificial intelligence.
The broader sector added 3.77%, while most chip stocks rose.
A series of robust US economic data eased concerns that the Federal Reserve would aggressively cut rates to curb any slowdown.
Weekly jobless claims fell more than expected, indicating a stable labor market, while the final reading of gross domestic product confirmed that the economy grew 3% in the second quarter.
“It (the GDP number) just reinforces the strong economic growth we’ve seen,” said Mike Dickson, head of research at Horizon Investments in Charlotte, North Carolina.
The benchmark S&P 500 closed down 23.11 points, or 0.40%, at 5,745.37, after rising to an intraday record high of 5,767.37.
The blue chip rose 260.36 points, or 0.62%, to 42,175.11. The advanced 108.09 points, or 0.60%, to 18,190.29.
Seven of the S&P 500’s 11 sectors rose, led by materials, which rose 1.97%.
The S&P 500 and Dow Jones have hit multiple record highs this year, while the tech-heavy Nasdaq is about 2% away from its own milestone. Market rebounds have been driven by optimism around AI and expectations of lower interest rates.
Metal prices got a boost after China promised to make “necessary budget expenditures”. miners like Freeport-McMoRan (NYSE:) gained 7.45%, while lithium miners including Albemarle (NYSE:) and Arcadium added 9.92%.
“The story driving the market definitely has to do with the Chinese stimulus measures and the announcement of the support the government is willing to provide to help improve consumer health there (and) reduce pressure on the real estate sector,” Dickson added.
However, energy stocks lost 2%, following crude prices that fell on expectations of increased supply from the Organization of the Petroleum Exporting Countries. [O/R]
The index that tracks small caps outperformed the broader market with a gain of 0.62%.
Late Wednesday, Fed Governor Adriana Kugler said she “strongly supported” the central bank’s decision to begin easing monetary policy last week.
Investors are fluctuating between a 25 to 50 basis point cut since the Fed began its easing cycle, with bets now favoring a larger cut, compared to 38.8% a week ago, CME Group’s FedWatch Tool showed ( NASDAQ:).
US-listed Chinese companies such as Li Auto (O:) rose 7.13%, PDD Holdings (O:) rose 13.28%, while Alibaba.com (N:) added 10.08%.
Shares of Wells Fargo rose 5.19% after a report showed the banking giant had sent the Fed a review for lifting restrictions on asset limits.
Southwest Airlines (NYSE:) rose 5.42% after the airline raised its third-quarter revenue forecast, while Accenture (NYSE:) rose 5.57% after the IT services company forecast full-year revenue above estimates.
On the NYSE, advancing issues outnumbered declining issues by a ratio of 1.94 to 1. There were 626 new highs and 71 new lows on the NYSE.
The S&P 500 posted 50 new highs and two new lows over the past 52 weeks, while the Nasdaq Composite posted 95 new highs and 94 new lows.
Volume on U.S. exchanges was 12.46 billion shares, compared to the full-session average of 11.82 billion over the past 20 trading days.
