Highlights
Hopes that the ceasefire will hold in the Iran war helped stocks build on Wednesday's rally on Thursday. The Dow Jones industrial average and the S&P 500 both gained 0.6 percent and the Nasdaq was up 0.8 percent. Bond yields and the dollar declined while oil prices gave back some early gains but still ended higher on the day.
The market reacted favorably after Israeli Prime Minister Benjamin Netanyahu said Israel would begin talks with Lebanon. Earlier he said Israel would continue to hit Hezbollah targets in Lebanon after huge attacks on Wednesday. Iran's leaders say Israel's attacks on Hezbollah in Lebanon violate the terms of the tentative two-week ceasefire agreement and would generate a big response from Iran. Shipping in the Strait of Hormuz remains nearly frozen as only a few ships have passed through.
Economic indicators mostly came in on the soft side, a negative for risk appetite; jobless claims were well above expectations and personal income well below.
Among sectors, Magnificent Seven stocks had a good ay with Amazon and Meta the leaders. Chipmakers, banks and machinery stocks outperformed. Lagging were travel & leisure, energy, software, chemicals, chain stores, and telecom.
Definition
Market Reflections track market reaction to the trading day's major events. Economic data, policymaker speeches, and company news are featured in this report as well as key indexes and financial instruments.
Description
Understanding why markets respond as they do is fundamental for an investor. Market Reflections help explain how the day's events, news, and data impact the outlook for the economy and for market prices.