Stocks fluctuated early in the session on Thursday but moved mostly higher over the course of the trading day. With the upward move, the tech-heavy Nasdaq jumped to a four-month closing high, while the S&P 500 reached its best closing level in over a month.
The major averages saw further upside going into the close, ending the session at their best levels of the day. While the Nasdaq surged 199.06 points or 1.8 percent to 11,512.41, the S&P 500 shot up 44.21 points or 1.1 percent to 4,060.43 and the Dow climbed 205.57 points or 0.6 percent to 33,949.41.
The strength on Wall Street came following the release of some upbeat U.S. economic data, including a Commerce Department report showing U.S. economic activity surged by more than expected in the fourth quarter of 2022., RTT News cited.
The report said real gross domestic product shot up by 2.9 percent in the fourth quarter after spiking by 3.2 percent in the third quarter. Economists had expected GDP to jump by 2.6 percent.
The stronger than expected GDP growth reflected increases in private inventory investment, consumer spending, government spending, and non-residential fixed investment.
Meanwhile, the positive contributions were partly offset by decreases in residential fixed investment and exports.
The Labor Department also released a report showing initial jobless claims unexpectedly dipped to a nine-month low in the week ended January 21st.
Separate Commerce Department reports also showed a spike in durable goods orders and a continued increase in new home sales.
The data paints a relatively positive picture of the economy but has also raised concerns about the outlook for interest rates ahead of next week’s Federal Reserve meeting.
The advance by the tech-heavy Nasdaq also came amid a surge by shares of Telsa (TSLA), with the electric vehicle maker soaring by 11.0 percent after reporting better than expected fourth quarter results and provided upbeat guidance.
On the other hand, IBM Corp. (IBM) posted a steep loss, limiting the upside for the Dow, even though the tech giant reported fourth quarter results that beat expectations. The company also announced plans to cut 3,900 jobs.
Steel stocks moved sharply higher over the course of the session, driving the NYSE Arca Steel Index up by 3.2 percent to its best closing level in over eleven years.
Substantial strength was also visible among oil stocks, as reflected by the 3.1 percent surge by the NYSE Arca Oil Index. With the increase, the index reached a record closing high.
The rally by oil stocks came amid a notable increase by the price of crude oil, with crude for March delivery jumping $0.86 or 1.1 percent to $81.01 a barrel.
Energy giant Chevron (CVX) posted a standout gain after announcing a $75 billion stock buyback and increasing its dividend.
Software stocks also saw significant strength on the day, resulting in a 2.9 percent spike by the Dow Jones U.S. Software Index.
Computer hardware, semiconductor and oil service stocks also showed notable moves to the upside, while gold stocks bucked the uptrend amid a decrease by the price of the precious metal.
Trading on Friday may be impacted by reaction to a report on personal income and spending, which includes a reading on inflation said to be preferred by the Federal Reserve. Reports on consumer sentiment and pending home sales may also attract attention along with the latest earnings news.
Intel (INTC) and Visa (V) are among the companies releasing their quarterly results after the close of today’s trading, while American Express (AXP) and Chevron (CVX) are among the companies due to report their results before the start of trading on Friday.