Stock market news live updates: Stocks rise as Wall Street looks to extend recovery

US stocks continued to rise on Thursday after a rebound in the previous trading session helped all three major averages register gains of well over 1%.

The S&P 500 and Dow Jones Industrial Average were up 0.3% as of 10:40 a.m. ET, while the tech-heavy Nasdaq Composite was up 0.4%.

On Wednesday, the S&P 500 rose 1.8%, the Dow Jones Industrial Average rose about 1.4% and the Nasdaq Composite rose 2.1% – snapping a seven-day losing streak and marking its biggest jump in four weeks.

As for economic data, initial jobless claims fell to their lowest level since May. Initial unemployment insurance claims totaled 222,000 in the week ended Sept. 3, the Labor Department said Thursday. Economists called for 240,000 claims, according to consensus estimates compiled by Bloomberg.

All eyes were on Federal Reserve Chairman Powell on Thursday morning as he spoke at the Cato Institute’s 40th Annual Money Conference in Washington The head of the US central bank reaffirmed the Fed’s commitment to fighting inflation, but remained hopeful that the undertaking could be done without the “very high social costs” of monetary tightening.

The appearance marked Powell’s last public remarks before the US central bank’s next policy announcement on September 21.

Across the Atlantic, the European Central Bank led to an unprecedented 75 basis point increase in the interest rate and signaled further increases after euro zone inflation hit a new record.

The increase came just two weeks before the Federal Reserve is poised to raise US interest rates by 0.75% for the third time in a row. Some market participants had hoped that policymakers would slow the pace of their campaign to raise interest rates this fall, but strong economic data on labor and manufacturing tempered those expectations.

U.S. Federal Reserve Board Chairman Jerome Powell listens during his renomination hearing for the Senate Banking, Housing and Urban Affairs Committee on Capitol Hill, in Washington, U.S., January 11, 2022. Brendan Smialowski/Bull via Reuters

U.S. Federal Reserve Board Chairman Jerome Powell listens during his renomination hearing for the Senate Banking, Housing and Urban Affairs Committee on Capitol Hill, in Washington, U.S., January 11, 2022. Brendan Smialowski/Bull via Reuters

CME Group’s The Fedwatch tool reflects expectations for a three-quarters of a percentage point increase at about 76%, up from 69% a week ago.

Goldman Sachs also raised its forecast for interest rates to rise 75 basis points in September from its previous expectation of a 0.50 percent increase, according to a note from economists led by Jan Hatzius.

Shares of GameStop (GME) were ripped nearly 9% higher after the meme favorite announced a partnership with crypto platform FTX late Wednesday. The video game retailer also reported second-quarter earnings that showed losses widened to $108.7 million, while sales fell 4 percent from a year earlier to $1.14 billion.

American Eagle Outfitters (LLC) shares fell 8% after the company missed earnings, suspended its quarterly dividend and warned that “demand trends remain difficult” in the current quarter.

In commodity markets, oil prices rose slightly after settling at a fresh seven-month low. On Wednesday, West Texas Intermediate crude fell 5.7% to $82.32 a barrel, its lowest level since Jan. 13, and Brent futures fell 5.4% to $87.62 a barrel.

Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc

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