NEW YORK (AP) — Wall Street is rising toward more records on Thursday as Nvidia and Intel lead a rally for technology stocks after announcing a deal that includes a $5 billion investment.
The S&P 500 rose 0.6% and was on track to squeak past its all-time high, which was set at the start of the week. The Dow Jones Industrial Average was up 147 points, or 0.3%, as of 1:59 p.m. Eastern time, and the Nasdaq composite was 1% higher. Both were likewise flirting with records.
Intel soared 22.6% and was heading toward its best day since 1987 after Nvidia said it would buy $5 billion of the chipmaker’s stock. It’s part of a collaboration where the pair will develop products for data centers and personal computers. Nvidia climbed 3.4% and was by far the strongest force lifting the S&P 500 because it’s Wall Street’s most valuable company.
Encouraging reports on the economy, meanwhile, helped send Treasury yields climbing in the bond market. One report said that growth in manufacturing in the mid-Atlantic region was much stronger than economists expected. Another said that fewer U.S. workers applied for unemployment benefits last week than expected.
The second report could indicate the pace of layoffs is slowing, and it was a relief after the prior week’s data showed a disconcerting leap to a four-year high. The job market has slowed so much that the Federal Reserve on Wednesday cut its main interest rate for the first time this year in order to give it some help.
The Fed also indicated more cuts may be on the way this year and next, though Chair Jerome Powell warned that the Fed is stuck in a precarious position and may have to change course quickly. That’s because the economy is in the unusual situation where the job market is slowing when inflation is remaining stubbornly high at the same time.
The Fed is in charge of fixing both, but it has only one tool to do that. And helping one by moving interest rates often hurts the other in the short term.
Expectations are high on Wall Street for the Fed to keep cutting interest rates, and a halt in cuts could send stocks tumbling. Critics say stock prices have already shot too high and become too expensive, in part because of the heavy bets on continued cuts in rates.
On Wall Street, Novo Nordisk saw its stock that trades in the United States rise 6.2% after the Danish company said a newly published study showed its once-a-day pill version of Wegovy helped people lose significant weight. It also said that its Ozempic product reduced the risk of heart attack, stroke and death for patients versus another treatment for some people with type 2 diabetes.
Stocks in the cryptocurrency industry also jumped to strong gains, including rises of 9% for Coinbase Global, 11.8% for Bullish and 9.1% for Circle Internet Group. Bitcoin has climbed above $117,500 following the Fed's cut to interest rates.
On the losing end of Wall Street, the company behind Olive Garden and other restaurant chains sank 7.6% after it reported a profit for the latest quarter that was below analysts' expectations. Darden Restaurants also raised its forecast for revenue growth this fiscal year, but not by much more than analysts expected.
Cracker Barrel fell 5.6% after the restaurant chain likewise reported a weaker profit for the latest quarter than analysts expected. It also gave a forecast for revenue in its upcoming fiscal year that fell short of analysts’, as the controversy over its planned logo change continues to play out.
The Walt Disney Co. slipped 0.5% after the entertainment giant announced that its ABC television division had suspended Jimmy Kimmel’s late-night show indefinitely after comments that he made about Charlie Kirk’s killing led a group of ABC-affiliated stations to say they would not air the show.
Earlier in the day, FCC Chairman Brendan Carr called Kimmel’s comments “truly sick” and said his agency has a strong case for holding Kimmel, ABC and Disney accountable for spreading misinformation.
In stock markets abroad, indexes rose in Europe following a mixed performance in Asia.
London’s FTSE 100 added 0.2% after the Bank of England held its main interest rate steady.
South Korea’s Kospi rallied 1.4%, and Hong Kong’s Hang Seng fell 1.4% for two of the world’s bigger moves.
In the bond market, the yield on the 10-year Treasury rose to 4.10% from 4.06% late Wednesday. It’s a notable move after it had briefly dropped below 4% on Wednesday, weighed down by expectations for continued cuts to interest rates by the Fed.
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AP Writers Teresa Cerojano and Matt Ott contributed.
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