Summary
US markets swung Thursday before ending higher, as a new reversal in oil prices helped take the edge off pressure that had built from rising bond yields. The S&P 500 rose 0.2% and pulled closer to its all-time high set last week, while the Dow gained 0.6% and the Nasdaq added 0.1% after both sides erased earlier moves.
Oil’s volatility drove much of the early stock-market hesitation. Brent crude moved higher in the morning, briefly topping $109 per barrel and raising concerns that elevated energy costs could worsen inflation, but it later erased those gains and fell to finish the session down 2.3% at $102.58.
The back-and-forth in oil prices has been tied to uncertainty about the length of the Iran war and the resulting impact on the Strait of Hormuz. The closure has prevented oil tankers from exiting the Persian Gulf to deliver crude to customers worldwide, keeping downward pressure from demand and upward pressure from disrupted supply competing throughout the day.
As oil eased, Wall Street also saw some relief from the bond market after yields had climbed to levels that investors worried could slow economies and weigh on assets. The cluster report said higher yields have already pushed the average long-term US mortgage rate to its most expensive level since last summer and could curtail company borrowing for projects such as AI data center buildouts.
The 10-year Treasury yield moved sharply around the same time as oil. The report said the yield briefly neared 4.63% in the morning before falling back to 4.55% after oil’s midday turn, after levels of 4.57% late Wednesday and 4.67% the day before.
Market leadership also reflected which parts of the economy are more exposed to rates and energy. The Russell 2000, an index tracking smaller US stocks, rose 0.9% while the report said companies with big fuel bills also benefited as oil prices eased, including Southwest Airlines and American Airlines, which rose 2.7% and 4.9% respectively.
Individual company results added more dispersion. Ralph Lauren jumped 13.9% after reporting stronger profit and revenue for the latest quarter than analysts expected, while Nvidia slid 1.8% after a strong report that still left the stock moving between gains and losses. Walmart fell 7.3% after its profit report, despite posting another quarter of impressive revenue, because it offered weaker forecasts for upcoming profit than analysts expected.
The Nvidia quarter included a strong outlook. CEO Jensen Huang said: “The buildout of AI factories — the largest infrastructure expansion in human history — is accelerating at extraordinary speed,” according to the report. The same account said Nvidia’s stock had already climbed nearly 70% over the prior year, more than double the S&P 500’s 27% jump, and some analysts pointed to investors locking in profits.
Beyond company results, the session also drew on early signals about the economy. A flash survey from S&P Global said growth in activity for US services businesses unexpectedly slowed a tad, though growth was better than forecast for US manufacturers, and Chris Williamson, chief business economist at S&P Global Market Intelligence, said the “damaging economic impact from the war in the Middle East is becoming increasingly evident in the business surveys.”
A separate report offered another sign on jobs. The account said the number of US workers applying for unemployment benefits last week unexpectedly declined, suggesting fewer layoffs than economists had expected.
Overseas, indexes were mixed. South Korea’s Kospi jumped 8.4% on strength in technology stocks, boosted by Samsung Electronics, which rose 8.5% after its labor union and management reached an agreement late Wednesday that averted a strike, and SK Hynix, a chip company partnering with Nvidia, rose 11.2%. Tokyo’s Nikkei 225 advanced 3.1%, while Hong Kong’s Hang Seng and Shanghai’s Composite fell 1% and 2%, respectively.