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US stocks saw a significant jump on Thursday afternoon, moving closer to fresh record highs. Investors responded positively to updates, including strong US economic data, upbeat earnings from Micron (MU), and China’s pledges for further stimulus to boost its economy.
The Dow Jones Industrial Average rose by 0.7%, and the S&P 500 added over 0.4% after a brief dip from all-time highs in the previous session. Meanwhile, the tech-focused Nasdaq Composite gained about 0.5%, partly driven by a sharp rise in Micron’s shares.
Markets received a “triple dose” of optimism from the AI sector, robust US economic performance, and China’s stimulus measures. During the session, Super Micro Computer (SMCI) saw its stock plunge 14% following a report that the Department of Justice is investigating the server maker after a short seller report from Hindenburg Research.
Key economic data provided additional boosts. The US government’s final update on second-quarter GDP growth exceeded Wall Street expectations, while weekly jobless claims dropped unexpectedly to their lowest level in four months.
Additionally, China’s leaders announced measures to revive their economy, including increased fiscal spending, halting the property crisis, and supporting the stock market. A surge in mainland stocks led the CSI 300 index toward its best week in a decade.
Investor sentiment was also lifted by growing expectations of a substantial interest rate cut from the Federal Reserve, with traders now pricing in around 50% odds of a 0.5% cut at the November meeting, up from 40% a week ago.