Wall Street snaps 3-day losing streak

Investors increasingly anticipate Fed nailing jobs market, economy landing

NEW YORK — Wall Street rose Thursday to snap its first three-day losing streak since Halloween.

The S&P 500 climbed 36.25 points, or 0.8 percent, to 4,585.59. The Dow Jones Industrial Average added 62.95, or 0.2 percent, to 36,117.38, and the Nasdaq composite jumped 193.28, or 1.4 percent, to 14,339.99.

Big Tech stocks helped power the market higher, led by a 5.3 percent leap for Google’s parent company, Alphabet. They’re Wall Street’s most influential stocks because of their massive size, and they have been on huge tears so far this year.

Cerevel Therapeutics also jumped 11.4 percent after Abbvie announced an $8.7 billion deal to buy the company and its pipeline of candidates for schizophrenia, Parkinson’s and other diseases. Abbvie added 1.1 percent.

Wall Street has rallied toward its best level since March 2022 largely on hopes that the Federal Reserve is finally done with its barrage of hikes to interest rates, which are meant to get high inflation under control. That has anticipation high ahead of a report on Friday, the U.S. government’s latest monthly update on the job market.

The Federal Reserve wants to see the job market slow by just the right amount. Too much weakness would mean people out of work and a possible recession, but too much strength could add upward pressure on inflation.

So far, anticipation is rising that the Federal Reserve can nail a perfect landing for the job market and overall economy. Inflation has been slowing since peaking two summers ago, and expectations are building that the Fed’s next move will be to cut interest rates next year.

A report on Thursday said that slightly more U.S workers applied for unemployment benefits last week, though the number is not alarmingly high and hit economists’ expectations exactly. That had both stock and bond markets relatively calm and waiting for Friday’s report, which could be more impactful.

The yield on the 10-year Treasury rose to 4.14 percent from 4.12 percent late Wednesday. It’s been generally easing since topping 5 percent in October and hitting its highest level since 2007.

The drop in the 10-year yield over the last month, including after accounting for inflation, is one of the reasons strategists at Goldman Sachs say the S&P 500 looks like it’s trading “roughly in line with fair value,” even after its nearly 9 percent rip higher through November. Expectations for a healthy economy have also helped boost stocks.