STORY: Wall Street ended higher on Thursday with the S&P 500 scoring a record closing high, as chip stocks rallied and investors welcomed some encouraging economic data.
The Dow added six-tenths of a percent, the S&P 500 climbed four-tenths and the Nasdaq notched another six-tenths of a percent.
Weekly jobless claims fell more than expected, signaling a steady labor market, while the final reading of gross domestic product confirmed that the economy grew 3% in the second quarter.
That eased investors’ fears that the Federal Reserve’s supersized rate cut earlier this month may have been prompted by an unraveling economy.
Meanwhile, Chinese leaders, just days after unveiling a stimulus plan, pledged to deploy “necessary fiscal spending” to spur the world’s second-largest economy.
That gave metal prices another boost, and lifted shares of copper miners such as Freeport-McMoRan, as well as lithium miners Albemarle and Arcadium.
Rob Sluymer, technical strategist at RBC Wealth Management, explains why a rebound in Chinese markets is good for commodities.
“Some fairly negative economic backdrop in China, but we have already started to see those indices, like the stock exchange in Hong Kong or the stock exchange in China, start to show signs of bottoming over the last month or so. And so the recent stimulus measures that just came out have have caused a lot of these markets to rally strongly. [FLASH] And you have a very similar pattern developing in many of the industry groups and commodities that are globally sensitive to, are sensitive to the global economy. Copper is a really good example. When China’s economy starts to improve, they use a tremendous amount of industrial metals like copper.”
U.S.-listed shares of Chinese firms such as Li Auto, Temu parent PDD Holdings and Alibaba all saw healthy gains.
Shares of Wells Fargo added more than 5% after a report showed the banking giant had sent the Fed a review for lifting asset cap restrictions.
And shares of Southwest Airlines gained nearly five-and-a-half percent after the carrier raised its third-quarter revenue forecast.
