S&P 500, Nasdaq, Dow End Higher As Drop In Oil Prices Allays Inflationary Concerns — NVDA, MCD, CRWV, LMT, AMZN In Focus

• The S&P 500 ended Thursday 1.1% lower, while the Nasdaq 100 added 1.7 and the Dow Jones Industrial Average rose 0.6%.
• Treasury 10-year yields snapped an eight-day rising streak.
• Nvidia’s Jensen Huang expects to sell twice as many chips next year.

U.S. stock indices closed higher Thursday as falling oil prices and Treasury yields eased some inflation concerns a day after the Federal Reserve hiked interest rates.

The S&P 500 ended Thursday 1.1% lower, while the Nasdaq 100 added 1.7% and the Dow Jones Industrial Average rose 0.6%. The Russell 2000, which tracks stocks with small market capitalizations, rose about 0.8%.

Among ETFs tracking benchmark indexes, the SPDR S&P 500 ETF (SPY) gained 1.1%, and Invesco QQQ Trust (QQQ) ended Thursday 1.7% higher, while the SPDR Dow Jones Industrial Average ETF Trust (DIA) was up 0.6%.

Meanwhile, the VanEck Semiconductor ETF (SMH) and the iShares Semiconductor ETF (SOXX) added above 2.8% and 3.5%, respectively, tracking gains in Nvidia (NVDA), Advanced Micro Devices (AMD), Broadcom (AVGO) and Micron Tech (MU). The broader Vanguard Information Technology ETF (VGT) rose about 2.2%.

Chipmakers Arm Holdings (ARM) and Intel (INTC) led the Nasdaq 100 gains as tech and AI stocks stage a strong comeback.

Retail sentiment on Stocktwits for QQQ, SPY, and DIA was ‘bearish,’ with ‘high’ message volumes. 

US Market Drivers

The benchmark 10-year Treasury note yield slipped back below the 5% threshold, falling more than 7 basis points to 4.93%. This pullback followed a brief surge above the psychological level during Wednesday's session after the Federal Reserve announced its policy choice.

A pullback in crude oil prices provided additional tailwinds for stock indexes.

West Texas Intermediate crude lost nearly 1% to hover near $101 a barrel, while Brent crude dipped 1% toward $104. Energy prices retreated as fears of supply shocks eased amid reports that Saudi Arabia plans to boost crude deliveries to refiners across Asia. The United States Oil Fund (USO) eased 0.6%. 

The US Federal Reserve's rate hike and indication of another hike later this year spooked investors on Wednesday and fanned inflation fears; however, the drop in energy prices and cooling yields largely calmed rate jitters. 

“Now that we are past this rate hike, stocks can move on, as uncertainty has faded,” Bob Edwards at Edwards Asset Management told Bloomberg. “I don’t see the need to stack additional rate hikes on top of Wednesday’s just to prove a point, but the Federal Reserve is going to follow what it deems necessary.” 

Key Trending Stocks

Generac Holdings Inc. (GNRC): The stock surged 19% after it agreed to supply up to $8 billion worth of generators for Amazon.com Inc.’s data centers and issued a warrant for a stake in the company.

Nvidia Corp. (NVDA) expects to double its chip sales over the next year, propelled by the rapid integration of AI technology across diverse global industries. 

The State Department has notified Congress of a landmark plan to sell up to 48 F-35 Lightning II joint strike fighters, manufactured by Lockheed Martin (LMT), to Saudi Arabia in a proposed transaction valued at up to $24.3 billion.  

McDonald's Corp (MCD) rose 0.7% before paring the gains on Thursday after a report said that the fast-food company will change its strategy to reverse slowing U.S. growth. 

CoreWeave (CRWV): The company disclosed that it is signing new compute contracts at roughly $40 million per megawatt, alongside two capital raises that will lean on that demand picture. 

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