US stock markets ended higher, with the S&P 500 reaching a record closing high, bolstered by robust US economic data and a surge in shares of Micron Technology, Reuters reports.
The Dow Jones Industrial Average and Nasdaq Composite also posted gains, as positive signals from the labor market eased concerns about a potential economic slowdown.
Micron Technology shares soared 15.78% after the company projected first-quarter revenue that exceeded expectations, driven by strong demand for memory chips used in artificial intelligence (AI) computing. This added to the growing optimism around AI and its potential to fuel further market gains.
A key driver behind the market’s positive performance was a better-than-expected US jobless claims report, which indicated a steady labor market. Weekly jobless claims fell more than anticipated, while the final reading of second-quarter gross domestic product (GDP) confirmed the US economy grew at a healthy 3%.
“The GDP number just reinforces the strong economic growth backdrop we’ve been seeing,” said Mike Dickson, head of research at Horizon Investments in North Carolina.
The S&P 500 closed up 0.40% at 5,745.37 after reaching a record intraday high of 5,767.37. The Dow rose 260.36 points, or 0.62%, to 42,175.11, and the Nasdaq advanced 0.60% to close at 18,190.29. Seven of the 11 S&P 500 sectors posted gains, led by materials, which climbed 1.97%.
Metal prices also saw a lift after China pledged increased fiscal spending to support its economy. Copper miners, such as Freeport-McMoRan, rose 7.45%, while lithium miners including Albemarle and Arcadium gained 9.92%. The Chinese stimulus package is seen as crucial for boosting consumer confidence and reducing real estate pressures, further supporting the global commodities market.
“The story driving the market is definitely the Chinese stimulus and the government’s commitment to supporting growth,” Dickson added.
However, energy stocks lagged, with the sector dropping 2% as crude oil prices fell on expectations that the Organization of the Petroleum Exporting Countries (OPEC) would increase supply.
Small-cap stocks outperformed the broader market, with the Russell 2000 index gaining 0.62%. US-listed Chinese firms also rallied, with companies like Li Auto, PDD Holdings, and Alibaba posting significant gains.
Investors are also closely watching the Federal Reserve, as Governor Adriana Kugler expressed support for the central bank’s recent monetary easing. Markets are now increasingly betting on a larger interest rate cut in the near future, with expectations for a 50-basis-point reduction rising.
In other sectors, Wells Fargo gained 5.19% after reports that the bank had submitted a review to the Federal Reserve to lift asset cap restrictions. Southwest Airlines saw a 5.42% rise after revising its third-quarter revenue forecast upward, while Accenture climbed 5.57% on stronger-than-expected annual revenue projections.
On the New York Stock Exchange (NYSE), advancing stocks outnumbered decliners by a ratio of nearly 2 to 1. The S&P 500 posted 50 new 52-week highs, while the Nasdaq Composite recorded 95 new highs. Trading volume on US exchanges reached 12.46 billion shares, higher than the 20-day average of 11.82 billion.
