U.S. Stocks Show Strong Move Back To The Upside

After moving in opposite directions early in the session, the major U.S. stocks indexes all moved notably higher over the course of the trading day on Thursday.

The Dow outperformed its counterparts throughout the session and closed up 341.73 points or 1.1 percent at 33,003.57, adding to the slight uptick seen in Wednesday’s session.

The tech-heavy Nasdaq climbed 83.50 points or 0.7 percent to 11,462.98, while the S&P 500 advanced 29.96 points or 0.8 percent to 3,981.35.

The surge by the Dow largely reflected a spike by shares of Salesforce (CRM), with the cloud-based software company soaring by 11.5 percent.

The rally by Salesforce came after the company reported better than expected fourth quarter results, provided upbeat guidance and increased its share buyback program to $20 billion.

Meanwhile, the rebound by the Nasdaq and S&P 500 was partly attributed to comments from Atlanta Federal Reserve President Raphael Bostic, who indicated he strongly favors raising interest rates in quarter-point increments.

“I am still very much of a mindset that slow and steady is going to be the appropriate course of action,” Bostic told reporters.

The turnaround may also have reflected bargain hunting, with the Nasdaq and S&P 500 bouncing off their lowest intraday levels in over a month.

Traders largely shrugged off a continue surge in treasury yields, which came following the release of a Labor Department report unexpectedly showing a modest decrease in initial jobless claims.

The Labor Department said initial jobless claims edged down to 190,000 in the week ended February 25th, a decrease of 2,000 from the previous week’s unrevised level of 192,000. Economists had expected jobless claims to inch up to 195,000.

“The jobless claims data continue to tell the same story: The labor market is too tight to help the Fed in its effort to lower inflation and the data leave the Fed on track to raise interest rates at the next three meetings,” said Nancy Vanden Houten, Lead US Economist at Oxford Economics.

Sector News

Oil service stocks moved sharply higher over the course of the session, driving the Philadelphia Oil Service Index up by 2.1 percent.

The rally by oil service stocks came amid an increase by the price of crude oil, with crude for April delivery climbing $0.47 to $78.16 a barrel.

Substantial strength also emerged among software stocks, as reflected by the 2.1 percent jump by the Dow Jones U.S. Software Index. The index bounced off its lowest closing level in a month.

Transportation, steel and utilities stocks also showed strong moves to the upside on the day, while considerable weakness remained visible among banking and computer hardware stocks.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Thursday. Japan’s Nikkei 225 Index edged down by 0.1 percent, while South Korea’s Kospi climbed by 0.6 percent.

Meanwhile, the major European markets all moved to the upside on the day. While the French CAC 40 Index advanced by 0.7 percent, the U.K.’s FTSE 100 Index rose by 0.4 percent and the German DAX Index edged up by 0.2 percent.

In the bond market, treasuries extended the sharp pullback seen in the previous session. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, climbed 7.9 basis points to 4.073 percent.

Looking Ahead

A report on U.S. service sector activity may attract attention on Friday, with traders looking for additional clues about the outlook for the economy and interest rates.

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