Stocks bounced back to finish higher on Thursday as investors shook off the previous session's slide, which ended a two-week winning streak as Wall Street heads into the final full trading days of the year.
The Dow Jones Industrial Average closed up 322 points, or 0.87%, while the S&P 500 gained 1.03% and the tech-heavy Nasdaq climbed 1.26%.
U.S. GDP grew at an annualized rate of 4.9% in the third quarter, slower than the Census Bureau's previous estimate of 5.2%.
"Lower-than-expected jobless claims and a downward revision to GDP weren’t earth-shattering numbers, but they were still in line with the narrative that a cooling economy will keep the Fed on track to cut rates in the not-too-distant future," said Chris Larkin, managing director for trading and investing at E*TRADE from Morgan Stanley.
"Right or wrong, that sentiment has played a big role in the market’s recent surge, even though the Fed has been doing its best to temper expectations," Larkin said.
In terms of individual stocks, Micron (MU) -) finished up 8.63% after the chipmaker posted a narrower-than-expected fiscal-first-quarter loss and issued a solid near-term sales forecast linked to AI-related demand.
Salesforce (CRM) -) gained 2.71% after Morgan Stanley upgraded the company's stock to overweight and boosted the firm's price target to $350 from $290.
Updated at 1:17 PM EST
Watch the vol
The market's key volatility gauge, the CBOE Group's VIX index, jumped to the highest levels in more than a month Thursday, extending its one-week advance to around 17% and rising past the $14 level traders often cite a indicative of near-term concern.
At $14.40, the VIX suggest traders see daily price movements of around 42 points, or 0.9%, for the S&P 500 over the next 30 days. That's up from the 35 point projection on December 12 and markets the highest level since November 10.
Updated at 12:04 PM EST
Mid-day hold
Stocks are holding steady into the middle of the session, while Treasury yields gave back some of this morning's rally in chopping bond market trading.
The S&P 500 was last marked 25 points higher, or 0.54%, while the Dow was up 143 points and the Nasdaq 104 points.
Benchmark 10-year note yields retraced to 3.881%, after hitting a late July low in the morning session, while WTI crude futures fell 90 cents to $73.33 per barrel.
Updated at 9:54 AM EST
Fed still in the driver's seat
Softer, but solid third quarter GDP data and a steady labor market has stocks firmly higher in early trading, with investors looking for ways to justify bets on a near-term Fed rate hike that is likely to extend the current rally into the end of the year.
"Lower-than-expected jobless claims and a downward revision to GDP weren’t earth-shattering numbers, but they were still in line with the narrative that a cooling economy will keep the Fed on track to cut rates in the not-too-distant future," said Chris Larkin, managing director for trading and investing at E*TRADE from Morgan Stanley. "Right or wrong, that sentiment has played a big role in the market’s recent surge, even though the Fed has been doing its best to temper expectations."
The SP&P 500 was marked 40 points higher, or 0.85%, in early trading while the Dow gained 277 points and the Nasdaq 153 points.
Updated at 8:51 AM EST
Renewed bond rally
Treasuries are extending their recent gains, with benchmark 10-year note yields falling another 4 basis points to 3.836%, the lowest since July 24, and 2-year notes slipping 5 basis points to 4.324%.
Updated at 8:37 AM EST
Strong like bull
The U.S. economy ended the third quarter with a 4.9% growth rate, the Commerce Department confirmed, a notable revision from its prior estimate of 5.2% but still the strongest in early two years and a rate that still carries solid momentum into the final months of the year.
New jobless claims, meanwhile, were up only modestly, rising by 2,000 to 205,000 over the week ending December 16, a level that lowers the closely-watched four-week average to around 212,000.
Stocks were holding on to earlier gains following the data releases, with the S&P 500 called 31 points higher and the Dow set for a 206 point advance. The Nasdaq is called 152 points higher.
Updated at 7:52 AM EST
Boeing extends gains
Boeing (BA) -), which is up more the 20% over the past month, is flying higher again Thursday following reports that suggest the planemaker is close to resuming 787 and 737 Max deliveries to China
Related: Boeing higher as reports suggest China ready to take 737 and 787 deliveries
Stock Market Today
Stocks tumbled over the final two hours of trading, lead to the downside by a 1.5% decline for the Nasdaq, even as Treasury bond yields extended their recent rally and underlying economic data showed stronger-than-expected existing-home sales and a firm move higher in consumer confidence.
Trading volumes were thin, however, and some analysts put the decline down to both late-year profit-taking and a surge in so-called OTDE options, which expire within 24 hours.
Micron's (MU) -) narrower-than-expected fiscal-first-quarter loss, which was posted after the close of trading, and the chipmaker's solid near-term outlook provided an overnight boost for U.S. equity futures, while limiting losses in Asia.
Related: Micron surges on outlook for AI-powered-chip sales and narrower Q1 loss
The ongoing rally in Treasuries is also likely to give markets a further lift ahead of weekly jobless claims and third-quarter GDP data at 8:30 a.m. Eastern Time.
Benchmark 10-year yields were last marked 3 basis points (0.03 percentage point) lower at 4.884% while 2-year notes were 1 basis point lower at 4.375%.
In other markets, oil prices slipped lower following Energy Department data showing record U.S. production of 13.3 million barrels a day. Alongside a 2.9 million increase in stockpiles at the key delivery hub in Cushing, Okla., the report added to concern about a pullback in global demand.
Brent crude contracts for February delivery were last marked 24 cents lower at $79.46 a barrel while WTI contracts for the same month, the new U.S. benchmark, fell 20 cents to $74.02 per barrel.
On Wall Street futures contracts tied to the S&P 500, which is now up 4.4% for the month, are indicating a 22 point opening-bell gain. Those linked to the Dow Jones Industrial Average are suggesting a 158-point advance.
The Nasdaq, which is getting help from a 6% premarket gain from Micron, is called 106 points higher.
In Europe, the regionwide Stoxx 600 was marked 0.5% lower in early Frankfurt trading while Britain's FTSE 100 was down 0.49% in London.
Overnight in Asia, Japan's Nikkei 225 closed 1.59% lower from its latest 33-year high to end at 33,140.47 points, while the regionwide MSCI ex-Japan index slipped 0.18% into the close of trading.
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