WASHINGTON (dpa-AFX) - Stocks have moved sharply higher during trading on Thursday, largely offsetting the weakness seen in the previous session. The major averages have all shown strong moves to the upside, with the tech-heavy Nasdaq leading the charge.
Currently, the major averages are just off their highs of the session. The Nasdaq is up 423.35 points or 1.9 percent at 23,116.67, the S&P 500 is up 87.16 points or 1.3 percent at 6,808.59 and the Dow is up 423.88 points or 0.9 percent at 48,309.85.
The rally on Wall Street comes following the release of a closely watched Labor Department unexpectedly showing a slowdown in the annual rate of consumer price growth.
The Labor Department said consumer prices in November were up by 2.7 percent compared to the same month a year ago.
The year-over-year price growth in November reflects a notable slowdown from the 3.0 percent surge in September. Economists had expected the annual rate of growth to tick up to 3.1 percent.
The annual rate of growth by core consumer prices, which exclude food and energy prices, also slowed to 2.6 percent in November from 3.0 percent in September. The pace of core price growth was expected to remain unchanged.
The tamer-than-expected inflation data has led to renewed confidence the Federal Reserve will continue cutting interest rates next year.
'Inflation has lost its grip-and the Fed knows it,' said Gina Bolvin, President of Bolvin Wealth Management Group. 'Today's CPI print gives the market what it needed: confirmation that disinflation is durable and policy relief is coming.'
A separate report released by the Labor Department showed first-time claims for U.S. unemployment benefits declined roughly in line with economist estimates in the week ended December 13th.
The Labor Department said initial jobless claims fell to 224,000, a decrease of 13,000 from the previous week's revised level of 237,000.
Economists had expected jobless claims to slip to 225,000 from the 236,000 originally reported for the previous week.
Sector News
Semiconductor stocks are showing a substantial rebound after falling sharply on Wednesday, resulting in a 3.1 percent spike by the Philadelphia Semiconductor Index.
Computer hardware, software and networking stocks are also seeing significant strength, contributing to the surge by the tech-heavy Nasdaq.
Outside of tech sector, airline, retail and gold stocks are turning in strong performances, while energy stocks are giving back ground after yesterday's rally.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Thursday. Japan's Nikkei 225 Index slid by 1.0 percent, while China's Shanghai Composite Index crept up by 0.2 percent.
Meanwhile, the major European markets have all moved to the upside on the day. While the German DAX Index is up by 0.9 percent, the French CAC 40 Index is up by 0.8 percent and the U.K.'s FTSE 100 Index is up by 0.6 percent.
In the bond market, treasuries have moved notably higher in reaction to the inflation data. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 4.1 basis points at 4.110 percent.
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