US stocks climbed on Thursday as a retreat in oil prices offered some relief to investors a day after the Federal Reserve raised interest rates. The move also eased pressure from rising Treasury yields, while technology stocks regained ground, according to Reuters.
The Dow Jones Industrial Average rose 316.08 points, or 0.59%, to 51,763.46, while the S&P 500 gained 71.28 points, or 0.94%, to 7,623.09. The Nasdaq Composite added 321.49 points, or 1.25%, to 26,302.28.
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The rebound comes as investors assess the Fed’s rate decision and its warning that further increases may be needed to bring inflation under control. The S&P 500 has already fallen 1.7% in September, traditionally a difficult month for equities.
"Although the argument that energy prices are elevated because of a temporary disruption in the Middle East may be true, inflation has been above target for over five years," said Chris Zaccarelli, chief investment officer at Northlight Asset Management.
Warsh "threaded the needle very well," he said.
Oil retreat offers some breathing room
Oil prices fell for a second straight session, providing a boost to stocks even as concerns over supply disruptions from the Yemen conflict remained. Brent crude futures fell nearly 3% to $102.90 a barrel, while US West Texas Intermediate crude declined 1.8% to $100.62.
Lower oil prices helped ease some of the inflation concerns that have weighed on markets. The benchmark 10-year US Treasury yield also slipped, reducing pressure on equities. Higher Treasury yields can make stocks less attractive by increasing the return available from relatively low-risk government debt.
All 11 major S&P 500 sectors were trading higher, with utilities leading the gains with a 1% rise. The CBOE Volatility Index fell 2.01 points to 15.70.
"I think the Fed is likely to maintain a light touch going forward. It doesn't feel like we've entered the type of rate-hiking cycle we saw in 2022 and 2023," said Kim Forrest, chief investment officer at Bokeh Capital Partners.
Rate path remains a key risk
Despite Thursday’s gains, uncertainty over the Fed’s next moves could keep stocks and bonds volatile. Traders were pricing in a near 49% chance of another rate increase at the Fed’s October meeting, up from about 44% a day earlier, according to CME’s FedWatch.
"History is clear that once the Fed begins raising rates, they do it multiple times; but the pattern is less clear about whether they will raise rates at consecutive meetings or leave rates unchanged at some of the meetings in between," Zaccarelli said.
Elsewhere, crypto-linked stocks gained after the US securities regulator unveiled a five-year exemption for tokenized stock trading. Robinhood and Circle Internet Group rose about 3.5% each, while Coinbase gained 1.2%.
Nebius and IREN rose about 1.4% each, while CoreWeave fell 2.9% after announcing plans to raise capital through stock and convertible bond offerings. Fluence Energy tumbled more than 16% after cutting its fiscal 2026 revenue forecast.
(Disclaimer: This article is based on inputs from agencies. These do not represent the views of The Economic Times)
