Stocks rebound from midweek slump.
The U.S. stock market rallied on Thursday, clawing back some of Wednesday’s brutal slump as surging tech shares lifted the major indices higher.
All of Wall Street’s major indices reported gains. The Dow Jones Industrial Average (NYSEARCA:DIA) rose 122.42 points, or 0.5%, to 26,201.04.
The broad S&P 500 Index (NYSEARCA:SPY) jumped 0.8% to close at 2,910.63. Most sectors reported gains, led by information technology. Energy, real estate and consumer staples also outperformed the benchmark.
Meanwhile, the technology-focused Nasdaq Composite Index (NYSEARCA:QQQ) advanced 1.1% to 7,872.27.
A measure of 30-day volatility known as the CBOE VIX (NYSEARCA:VXX) edged lower on Thursday after it climbed above the historic 20 mark during the middle of the week. The so-called “fear index” settled down 5.3% at 19.48 on a scale of 1-100 where 20 represents the historic average.
In economic data, the U.S. service economy weakened significantly last month, raising fresh fears about the prospect of a recession.
The Institute for Supply Management’s non-manufacturing purchasing managers’ index (PMI) weakened to 52.6 in September from 56.4 in August on a scale where 50 separates expansion from contraction.
Combined with a contracting manufacturing industry, the latest services PMI report paints a negative picture of the U.S. economy.
In a separate report on Thursday, the Department of Commerce said factory orders declined 0.1% in August after rising 1.4% the prior month.
Meanwhile, the Labor Department said initial jobless claims rose by 4,000 to a seasonally adjusted annual rate of 219,000 for the week ended Sept. 28.
The Final Word: Economic data are back in the headlines Friday, with the Department of Labor set to report on nonfarm payrolls. Employers likely added 145,000 workers to payrolls last month. The unemployment rate is forecast to hold steady at 3.7%.