Nasdaq, S&P 500 Soar 2% Higher in Rally After US Jobless Data

August 8 – A rally in US stocks on Thursday saw significant gains across major indices, with the Nasdaq and S&P 500 both climbing more than 2 percent. This surge came after a sharper-than-expected drop in jobless claims eased fears of a rapidly weakening labor market.

The Dow Jones Industrial Average surged by 683.04 points, or 1.76 percent, closing at 39,446.49. Meanwhile, the S&P 500 gained 119.81 points, or 2.30 percent, reaching 5,319.31. The Nasdaq Composite, known for its tech-heavy focus, soared by 464.22 points, or 2.87 percent, finishing at 16,660.02.

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Positive Jobs Data Alleviates Market Fears

Investor anxiety had heightened following last Friday’s (August 2) report, which revealed that fewer jobs were created in July than anticipated. This sparked concerns that the Federal Reserve’s delayed interest rate cuts might push the US economy towards a recession. However, the latest jobless claims data has helped to allay these fears, providing a much-needed boost to market sentiment.

Key Market Movers

Several stocks made notable moves on Thursday. Under Armour shares skyrocketed by 19.2 percent after the sports apparel maker posted an unexpected first-quarter profit. This impressive performance was attributed to the company’s strategic efforts to streamline inventory and cut down on promotions.

Eli Lilly also enjoyed a substantial gain, with its stock surging 9.5 percent. The pharmaceutical giant raised its annual profit forecast, driven by the blockbuster sales of its weight-loss drug Zepbound, which topped $1 billion in a single quarter for the first time.

Big Tech stocks rebounded after weeks of significant losses. Apple saw a 1.7 percent rise, while Meta Platforms jumped 4.2 percent, leading the charge in a tech sector recovery that bolstered gains across Wall Street.

On the flip side, not all stocks fared well. Bumble, the Texas-based dating app, saw its shares plummet by 29.2 percent after its third-quarter revenue forecast fell short of analysts’ expectations. Similarly, Warner Bros. Discovery faced a steep decline, with shares dropping around 9 percent. This followed a report of a nearly $10 billion quarterly loss, largely due to a $9.1 billion write-down in the value of its cable network.

Bond Market Insights

In the bond market, the yield on the 10-year Treasury rose slightly to 3.99 percent from 3.95 percent on Wednesday (August 7). This uptick highlights the ongoing volatility as investors continue to assess the broader economic outlook.

Conclusion
Thursday’s stock market rally reflects a renewed sense of optimism among investors, buoyed by favorable jobless claims data and strong performances from key stocks like Under Armour and Eli Lilly. While concerns about the economy persist, particularly in light of mixed earnings reports, the market’s positive momentum suggests a resilient outlook for the near term.