On Thursday, U.S. stocks rebounded making most of the gains in the last trading hour. The Dow Jones Industrial Average rose 299 points (+1.18%) to 25745, the S&P 500 gained 33 points (+1.10%) to 3083, and the Nasdaq 100 was up 99 points (+0.99%) to 10101.
S&P 500 Index: Daily Chart
Source: GAIN Captial, TradingView
Banks (+3.57%), Insurance (+2.55%) and Diversified Financials (+2.07%) sectors gained the most after financial regulators eased up "Volcker Rule" restrictions on banks' risk-taking. Goldman Sachs (GS +4.59%), Wells Fargo (WFC +4.79%) and JPMorgan Chase (JPM +3.49%) led major indexes higher.
However, in after-market hours, the Federal Reserve, in anticipation of a prolonged economic downturn, announced measures to bar the nation's biggest banks from buying back their own stocks or increasing dividend payments in the third quarter.
On the technical side, about 36.7% (43.1% in the prior session) of stocks in the S&P 500 Index were trading above their 200-day moving average, and 13.5% (35.3% in the prior session) were trading above their 20-day moving average.
The U.S. Labor Department reported that Initial Jobless Claims decreased to 1.480 million for the week ended June 20 (1.320 million expected) and Continuing Claims slid to 19.522 million for the week ended June 13 (20.000 million expected).
And the Commerce Department said first-quarter GDP contracted 5.0% on quarter annualized (as expected), and Durable Goods Orders (preliminary reading) jumped 15.8% on month in May (+10.5% expected).
Due later today are reports on May Personal Income (-6.0% on month expected), Personal Spending (+9.0% expected), and the University of Michigan's Consumer Sentiment Index (a rise to 79.2 in June expected).
European stocks were broadly higher. The Stoxx Europe 600 Index climbed 0.7%, Germany's DAX rose 0.7%, France's CAC jumped 1.0%, and the U.K.'s FTSE 100 was up 0.4%.
U.S. government bond prices remained firm, as the benchmark 10-year Treasury yield dropped further to 0.670% from 0.683% Wednesday.
Spot gold price added $2.00 (+0.1%) to $1,763 an ounce.
Oil prices stabilized after losing for two sessions. WTI crude oil futures (August) increased 1.9% to $38.72 a barrel.
On the forex front, the ICE U.S. Dollar Index climbed 0.2% on day to 97.39, up for a second straight session. The Federal Reserve released the results of its stress tests, stating: ""The banking system has been a source of strength during this crisis, and the results of our sensitivity analyses show that our banks can remain strong in the face of even the harshest shocks."
EUR/USD fell 0.3% to 1.1220. Germany's GfK Consumer Confidence Index for July improved to -9.6 (-12.0 expected) from -18.6 in June.
GBP/USD was little changed at 1.2424.
USD/JPY edged up 0.1% to 107.18. This morning, official data showed that Japan's Tokyo CPI grew 0.3% on year in June (as expected).
GAIN Capital UK Limited (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.
No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.