Wall Street up solidly despite recession worries
Wall Street's main indexes posted solid gains on Thursday, fueled by strong performance from defensive and tech shares that outweighed declines for economically sensitive groups as worries persisted about a potential recession. The benchmark S&P 500 swung between positive and negative during the session, but stocks picked up steam heading into the market's close. Benchmark US Treasury yields fell to two-week lows, supporting tech and other rate-sensitive growth stocks. Trading has remained volatile in the wake of the S&P 500 last week logging its biggest weekly percentage drop since March 2020. Investors are weighing how far stocks could fall after the index earlier this month fell over 20 percent from its January all-time high, confirming the common definition of a bear market. “There is a tremendous amount of uncertainty about the outlook and so the market is confused,” said Walter Todd, chief investment officer at Greenwood Capital in South Carolina. The Dow Jones Industrial Average rose 0.64 percent, to 30,677, the S&P 500 gained 0.95 percent, to 3,796 and the Nasdaq Composite added 1.62 percent, to 11,232. In his second day of testifying before Congress, US central bank chief Jerome Powell said the Fed's commitment to reining in 40-year-high inflation is "unconditional" but also comes with the risk of higher unemployment. US business activity slowed considerably in June as high inflation and declining consumer confidence dampened demand across the board, a survey on Thursday showed. “The Fed wants to see things start to slow and the data is starting to reflect that,” said James Ragan, director of wealth management research at D.A. Davidson. Citigroup analysts are forecasting a near 50 percent probability of a global recession. “Economic growth is slowing. Is it going to slow enough to go into a recession, that’s the big question,” Ragan said. The heavyweight tech sector rose 1.4 percent, with Microsoft gaining 2.3 percent and Apple up 2.2 percent. (Reuters)