Stocks gain for the second day in a row as the recovery continues

Stocks gain for the second day in a row as the recovery continues

US stocks rose for the second straight session on Thursday after hovering between gains and losses for much of the trading day.

The S&P 500 climbed 0.7% and the Dow Jones Industrial Average and tech-heavy Nasdaq Composite rose 0.6% each.

All eyes were on Federal Reserve Chairman Powell on Thursday as he spoke at the Cato Institute’s 40th annual monetary conference in Washington DC. of monetary tightening.

The performance marked Powell’s final public comments before the Fed’s next policy announcement on September 21.

Thursday’s seesaw comes after the S&P 500 rose 1.8% on Wednesday, the Dow Jones Industrial Average about 1.4% and the Nasdaq Composite 2.1% – breaking a seven-day streak of declines and recording the largest jump in four weeks.

In terms of economic data, first-time jobless claims fell to their lowest level since May. In the week ending Sept. 3, a total of 222,000 applications for first-time unemployment insurance totaled, the Labor Ministry said on Thursday. Economists claimed 240,000 claims, according to consensus estimates prepared by Bloomberg.

On the other side of the Atlantic, the European Central Bank delivered an unprecedented 75 basis point rate hike and signaled further increases after euro-zone inflation hit a new record high.

The rise came just two weeks before the Federal Reserve was ready to raise US interest rates by 0.75% for the third consecutive time. Some market participants had hoped policymakers would slow the pace of their rate hike campaign this fall, but strong economic data in labor and manufacturing has dampened those expectations.

US Federal Reserve Board Chairman Jerome Powell listens during his hearing on renominations from the Senate Committee on Banking, Housing and Urban Affairs on Capitol Hill, in Washington, US, January 11, 2022. Brendan Smialowski/Pool via REUTERS

CME Group’s Fedwatch tool reflects expectations for a three-quarter increase of about 86%, up from 69% a week ago.

A string of Wall Street institutions also raised their bets on a 75 basis point rise this month, including Bank of America, Goldman Sachs and Nomura.

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