Wall Street’s main indexes rallied on Thursday, boosted by technology stocks and strong quarterly results from Bank of America and Walgreens, while better-than-expected economic data eased some concerns about higher inflation.
At 12:08 p.m. ET, the Dow Jones Industrial Average was up 499.56 points, or 1.45%, at 34,877.37, the S&P 500 was up 67.63 points, or 1.55%, at 4,431.43, and the Nasdaq Composite was up 237.63 points, or 1.63%, at 14,809.26.
Citigroup, Bank of America Corp and Morgan Stanley topped quarterly earnings estimates, helped by release of more reserves to cover loan losses, with torrid dealmaking, equity financing and trading activity adding to their profits.
Their shares gained between 0.1% and 3.3%. Walgreens Boots Alliance Inc jumped 5.9% to top the S&P 500 and the Dow, after the drugstore chain reported fourth-quarter revenue and adjusted profit above estimates and forecast growth of 11% to 13% in the long term.
“The market strength today is partly predicated on better than expected earnings,” said Andre Bakhos, managing director at New Vines Capital LLC in Bernardsville, New Jersey.
All of the 11 major S&P sectors advanced, with nine of them gaining more than 1%. The small cap Russell 2000 index added 1.3%.
The biggest boost came from growth names including Facebook Inc, Microsoft Corp, Apple Inc and Google-parent Alphabet, which rose more than 1%.
“There seems to be a little bit of FOMO (fear of missing out), but there’s a broadening out in markets, the buyers are coming into stocks broadly, and arguably, that’s a healthy thing,” said John Augustine, chief investment officer at Huntington Private Bank.
Analysts expect corporate America to report strong quarterly profit growth and will focus on commentary from companies on how they are going to battle rising costs, labor shortages and supply chain disruptions.
Meanwhile, data showed the number of Americans filing new claims for unemployment benefits fell close to a 19-month low last week, while a separate report showed producer prices eased in September.
The reports came a day after consumer prices rose solidly in September, which further strengthened the case for a interest-rate hike by the Federal Reserve.
“(Jobless claims) came out better than expected which is good … however, we have a situation where if the job market improves rapidly, investors are going to read that as hawkish for rates,” Bakhos said.
UnitedHealth Group Inc jumped 4.3% after the health insurer raised its full-year adjusted profit forecast on strength from its Optum unit that manages drug benefits.
Advancing issues outnumbered decliners by a 4.07-to-1 ratio on the NYSE and by a 2.37-to-1 ratio on the Nasdaq.
The S&P index recorded 29 new 52-week highs and no new lows, while the Nasdaq recorded 61 new highs and 28 new lows.