WASHINGTON (dpa-AFX) - Stocks moved to the downside in early trading on Thursday but showed a significant turnaround over the course of the session. The major averages climbed well off their lows of the session and into positive territory, with the tech-heavy Nasdaq leading the rebound.
The major averages once again finished the day at new record closing highs. The Nasdaq advanced 242.74 points or 0.9 percent to 26,917.47, the S&P 500 climbed 43.27 points or 0.6 percent to 7,563.63 and the Dow inched up 24.69 points or 0.1 percent to 50,668.97.
The turnaround on Wall Street came after a report from Axios said U.S. and Iranian negotiators have reached an agreement on a 60-day memorandum of understanding.
Citing two U.S. officials and a regional source involved in the mediation efforts, Axios indicated the MOU would extend the ceasefire and launch negotiations on Iran's nuclear program.
Axios noted President Donald Trump has not yet given final approval, with a U.S. official saying he wants a couple of days to think about the deal.
Crude oil prices pulled back well off their early highs following the report, with U.S. crude oil futures up by just 0.5 percent after surging as much as 4.3 percent.
The price of crude oil spiked overnight after reports the U.S. launched another round of 'self-defense strikes' in southern Iran, leading Tehran to retaliate by purportedly targeting a U.S. air base.
'Investors are still broadly positioned for a de-escalation scenario in the Middle East, but recent headlines are a reminder that the path toward any agreement remains fragile,' said Daniela Hathorn, Senior Market Analyst at Capital.com.
In U.S. economic news, the Commerce Department released a report showing consumer prices in the U.S. increased by slightly less than expected in the month of April.
The Commerce Department said its personal consumption expenditures (PCE) price index rose by 0.4 percent in April after climbing by 0.7 percent in March. Economists had expected prices to increase by 0.5 percent.
The report also said the annual rate of growth by the PCE price index accelerated to 3.8 percent in April from 3.5 percent in March, in line with estimates.
Excluding food and energy prices, the core PCE price index crept up by 0.2 percent in April after rising by 0.3 percent in March. Core prices were expected to rise by another 0.3 percent.
The annual rate of growth by the core PCE price index ticked up to 3.3 percent in April from 3.2 percent, matching expectations.
Sector News
Software and computer hardware and software stocks moved sharply higher on the day, contributing to the advance by the tech-heavy Nasdaq.
Reflecting the strength in the sectors, the Dow Jones U.S. Software Index spiked by 3.4 percent and the NYSE Arca Computer Hardware Index surged by 2.9 percent.
Significant strength was also visible among biotechnology stocks, as reflected by the 2.6 percent jump by the NYSE Arca Biotechnology Index.
Gold, pharmaceutical and healthcare stocks also saw notable strength, while oil service and utilities stocks moved to the downside.
Other Markets
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Thursday. Japan's Nikkei 225 Index declined by 0.5 percent, while Hong Kong's Hang Seng Index slumped by 1.3 percent.
The major European markets also moved to the downside on the day. While the U.K.'s FTSE 100 Index slid by 0.8 percent, the German DAX Index fell by 0.3 percent and the French CAC 40 Index dipped by 0.2 percent.
In the bond market, treasuries moved higher over the course of the session after seeing initial weakness. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, fell 2.6 basis points to 4.455 percent after reaching a high of 4.510 percent.
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