Stocks rose Thursday as the S&P 500 attempted to crack a five-day losing streak and Wall Street evaluated the odds of a recession ahead.
The Dow Jones Industrial Average jumped 226 points, or 0.7%, bolstered by gains from Chevron and Boeing. The S&P 500 added 0.7%, while the Nasdaq Composite rallied 0.8%.
The S&P kicked off the week on a sour note, building on losses from the previous week. Its fifth consecutive down session Wednesday brought the benchmark index to its longest losing streak since October.
“We had a strong selloff over the last few days and it doesn’t take much to create even the underpinnings for a modest rally,” said Quincy Krosby, LPL Financial’s chief global strategist, referring to Thursday’s jobless claims — specifically continuing claims —as the likely catalyst.
The data showed a modest uptick in claims. Continuing claims hit their higher level since February, a slight move in the right direction for the economy that could further fuel the narrative that the labor market needs to break in order for the Fed to successfully tamp down inflation.
“Again, we’re back to bad news being good news,” Krosby said.
Meanwhile, Exxon after lifting its buybacks, while Chevron gained on a higher capital spending budget. GameStop rose after posting earnings.
Investor attention remains laser-focused on next week’s Federal Reserve policy meeting, where the central bank is widely expected to issue a 50 basis point interest rate hike. It’s a smaller increase than the prior four rate hikes, but may do little to alleviate recession fears as the Fed attempt to squash surging prices.
Next week’s November consumer price index should also provide more clarity on the direction of inflation.
