Dow Jones, S&P Surge to Record Highs as Federal Reserve Stays Course With Stimulus

NEW YORK (Sputnik) - Stocks on Wall Street mostly surged on Thursday, with the Dow Jones Industrial Average and the S&P 500 indexes hitting record highs a day after the Federal Reserve ruled out any immediate change to US interest rates or the stimulus it was providing the economy.

The Dow, the broadest US equity barometer on the New York Stock Exchange, closed up 154 points, or 0.4 percent, at 35,084. It earlier hit an all-time high of 35,172.

The S&P 500, which groups the top 500 stocks on the New York Stock Exchange, settled up 19 points, or 0.4 percent, at 4,419. The S&P 500 hit its highest peak ever of 4,4230 during the session.

The tech-heavy Nasdaq Composite index, which groups high-flying tech names as Facebook, Amazon, Apple, Microsoft, Netflix and Google, finished the session up 16 points, or 0.1%, at 14,778.

“US stocks rallied to fresh record highs and Treasuries slumped anew after a downside surprise in both GDP and jobless claims justified the Fed[eral Reserve]’s dovish stance,” Ed Moya, analyst at New York brokerage firm OANDA, said.

US Gross Domestic Product likely expanded by 6.5 percent in the second quarter, the Commerce Department said on Thursday, estimating growth at well below the 8.5 percent forecast by economists.

Jobless claims, meanwhile, stood at 400,000 and above for a second week in a row, according to Labor Department data that suggested a continued challenge for the fragile labor market recovery amid the coronavirus pandemic.

On Wednesday, Federal Reserve Chair Jerome Powell said the central bank was not ready yet to raise interest rates as it was still focused on buying assets to support the recovering economy. Powell also refused to entertain any talk on when the Federal Reserve might consider tapering the $120 billion of monthly asset purchases.