Stocks rose as technology led a rebound: Thursday recap

U.S. stocks climbed on Thursday, recovering the ground they lost after the Federal Reserve’s rate decision a day earlier. The S&P 500 rose 1.13% to close at 7,637.76. The Nasdaq Composite led the major gauges, up 1.73% to 26,418.30, as large technology names powered ahead. The Dow Jones Industrial Average lagged but still gained 0.61%, finishing at 51,778.04. Small caps joined in more modestly, and the Russell 2000 added 0.53%. The advance was broad, lifting all four major stock benchmarks. It reversed most of Wednesday’s slide.

The gains ran widest in the groups that had been hit hardest. Technology finished on top, up 2.25% for the day’s biggest advance. Consumer discretionary rose 1.10% and utilities added 0.90%, while energy gained 0.70% and materials 0.69%. Two sectors could not keep pace. Communication services slipped 0.58%, the only meaningful decliner, and financials edged down 0.09%. Health care and consumer staples also finished in the green. Nine of the eleven groups closed higher, a near-mirror image of Wednesday’s broadly lower tape.

Two threads ran through the session. The first was relief after the Fed. On Wednesday the central bank raised its target range for the federal funds rate by a quarter point, to 3.75% to 4.00%, its first increase since 2023. A day later, investors read the move as a step to keep inflation in check rather than the opening of a steeper climb, and buyers returned to the stocks most sensitive to the rate outlook. The second was the labor market. Weekly initial jobless claims fell to 196,000, below the 208,000 economists had expected, a sign that hiring conditions remain firm. A regional factory gauge from the Philadelphia Fed came in stronger than forecast, while housing starts and building permits both eased from the prior month. Chipmakers led the technology advance, extending the appetite for growth names that had drained out of the tape earlier in the week.

The mood eased noticeably. The Cboe Volatility Index, Wall Street’s gauge of expected swings, fell 12.82% to 15.44, unwinding much of the anxiety that had built into the meeting. That reading sits at the calm end of its range. Advancers outnumbered decliners across the major averages. The strongest groups were growth and cyclical names, in keeping with the day’s risk-on tone. Small caps trailed the large-cap gauges, a reminder that the day’s strength leaned toward the biggest technology and growth names. The 10-year Treasury yield held near 5.00%, little changed even as equities rallied.

For the week, the picture is mixed. The S&P 500 is up 0.63% over the past five sessions and the Nasdaq 1.16%, while the Dow is down 0.46% and the Russell 2000 off 0.79%. With the rate decision behind it, the market turns to the industrial-production report still on this week’s calendar and to the Fed officials scheduled to speak in the days ahead. Inflation readings will draw particular attention, given the policy path the central bank laid out this week. How bond yields settle after a firmer stance will help set the tone into next week.

This is a general-market summary for information only — not investment advice, and not a recommendation regarding any security.