U.S. stocks extended their winning streak on Thursday, with the S&P 500 rising 0.7% and the Nasdaq Composite gaining 1%, marking their fourth consecutive day of gains.
The rally was led by technology stocks as investors balanced fresh inflation and labor data against growing expectations for a 25-basis-point interest rate cut by the Federal Reserve next week. The Dow Jones Industrial Average also moved up, closing 0.6% higher.
Early Thursday, the U.S. Producer Price Index (PPI) for August signaled further easing of inflation pressures. Wholesale prices increased by 0.2% month-over-month, slightly above economists’ predictions, while annualized PPI growth stood at 1.7%, in line with expectations.
Additionally, July’s PPI data was revised downward. This followed August's consumer price report, which also indicated gradual inflation cooling.
On the labor front, jobless claims increased more than expected, rising to 230,000 last week, up 2,000 from the previous week. Following this data, the probability of a 25-basis-point rate cut increased to 87%, up from 50% earlier in the week.
In corporate news, Moderna (MRNA) shares plunged 12% after the company slashed its revenue forecast for 2025 and announced cuts to its annual R&D budget.
On the bond markets, 10-year rates were at 3.68%.