NEW YORK (AP) — Wall Street rebounded Thursday, recouping nearly all of the losses it suffered earlier in the week.
The S&P 500 rose 41.73 points, or 0.9%, to 4,780.94, continuing its losing streak since the start of the holiday-shortened week. The Dow Jones Industrial Average rose $201.94, or 0.5%, to $37,468.61, and the Nasdaq Composite Index rose $200.03, or 1.3%, to $15,055.65.
Led by big tech stocks like Apple, Apple rose 3.3%, turning losses earlier this week into gains.
Semiconductor companies also performed well after Taiwan Semiconductor Manufacturing Co., Ltd. released its 2024 sales forecast, which analysts said exceeded expectations. Broadcom rose 3.6%, while U.S.-traded TSMC shares rose 9.8%.
they helped offset Warning from Humana How rising medical costs will put pressure on profits. The insurance company's stock price fell 8%.
In the bond market, U.S. Treasury yields slowed their rise from the start of the week, and the market was generally stable. Yields were rising as traders postponed their expectations for when the Federal Reserve would start cutting interest rates. Rising yields drive down stock prices and increase pressure on the economy.
The Fed has indicated it is likely to cut interest rates several times in 2024, as inflation has cooled from its peak two summers ago and the economy and financial system may not need to be tied down as tightly. This is because it means that there is. But critics said Wall Street's predictions about how much the Fed would cut interest rates this year and how quickly they would start were overblown. As a result, stock prices may have gotten too high and Treasury yields too low after the big move began last fall.
The 10-year Treasury yield rose again on Thursday, rising to 4.13% from 4.11% late Wednesday. However, the move was slower than the rise from 3.95% at the beginning of the week.
The yield on the two-year note, which depends largely on expectations for Fed action, remained at 4.36% as of late Wednesday. But there was still hesitation.
U.S. Treasury yields swung up and down in the minutes following Thursday morning's U.S. payrolls report. Apply for unemployment benefits Last week it fell to its lowest level since September two years ago. This is good news for workers and for the broader economy, which has so far weathered recession predictions.
However, if the job market is stronger than expected, upward pressure on inflation could continue. That would make it less likely that the Fed would cut rates immediately after its March meeting. Traders are now betting about 57% on that probability, down from more than 70% a week ago, according to CME Group data.
“The story this week continues to be strong economic data and the possibility that rate cuts will be frozen for some time,” said Chris Larkin, managing director of trading and investments at Morgan Stanley's E-Trade.
Other reports on the economy were mixed on Thursday. One study shows manufacturing in the Mid-Atlantic region is shrinking more than economists expected. Another official said home builders broke ground on more projects last month, exceeding economists' expectations, even though the numbers were lower than November's levels.
Wall Street was underperformed by several financial companies that reported weaker-than-analyst earnings for the end of 2023. Discover Financial Services fell 10.8% and KeyCorp fell 4.6%. Both companies reported higher-than-expected sales but profits that were well below Wall Street expectations.
Offsetting those were Fastenal, which soared 7.2%, the biggest gain in the S&P 500 index. Fastenal, a company that sells safety products, fasteners and other products, reported a bigger quarterly profit than analysts expected.
In overseas stock markets, indexes rose across much of Europe and Asia, narrowing losses so far this week.
AP Business writers Yuri Kageyama and Matt Ott contributed.