WASHINGTON (dpa-AFX) - Following the substantial rally seen during Wednesday's session, stocks gave back ground in early trading on Thursday but showed a notable turnaround over the course of the day. The major averages climbed well off their lows of the session and into positive territory.
The major averages added to the strong gains posted yesterday, reaching their best closing levels in over a month.
The Nasdaq advanced 187.42 points or 0.8 percent to 22,822.422, the Dow climbed 275.88 points or 0.6 percent to 48,185.80 and the S&P 500 rose 41.85 points or 0.6 percent to 6,824.66.
The turnaround on the day came as traders kept an eye on the latest developments in the Middle East and the subsequent impact on the price of crude oil.
While crude oil initially showed a substantial rebound from yesterday's nosedive, prices have given back ground since then but remain sharply higher.
The initial surge by crude oil prices came amid concerns about the fragility of the ceasefire in the Middle East, with Iran accusing the U.S. and Israel of violating the agreement.
Iran's deputy foreign minister Saeed Khatibzadeh claimed in an interview with the BBC that Iran had once again closed the Strait of Hormuz.
Khatibzadeh argued Israel's bombardment of Lebanon earlier in the day was an 'intentional grave violation' of the ceasefire agreement.
However, crude oil prices gave back ground after Israeli Prime Minister Benjamin Netanyahu said Israel would begin negotiating with Lebanon 'as soon as possible.'
Netanyahu said the negotiations would focus on disarming Iran-backed Hezbollah and establishing peaceful relations between Israel and Lebanon.
Sector News
Retail stocks moved sharply higher over the course of the session, driving the Dow Jones U.S. Retail Index up by 2.9 percent to its best closing level in over two months.
Significant strength also emerged among semiconductor stocks, as reflected by the 2.1 percent jump by the Philadelphia Semiconductor Index.
Transportation and banking stocks also showed strong moves to the upside, while substantial weakness remained visible among software stocks.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Thursday. Japan's Nikkei 225 Index and China's Shanghai Composite Index both slid by 0.7 percent, while Hong Kong's Hang Seng Index fell by 0.5 percent.
The major European markets also moved back to the downside on the day. While the German DAX Index slumped by 1.1 percent, the French CAC 40 Index dipped by 0.2 percent and the U.K.'s FTSE 100 Index edged down by 0.1 percent.
In the bond market, treasuries showed a lack of direction over the course of the session before closing roughly flat. The yield on the benchmark ten-year note, which moves opposite of its price, crept up by less than a basis point to 4.293 percent.
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