US stocks closed sharply higher Thursday as strong bank earnings, a drop in initial jobless claims to a pandemic low and cooling producer price inflation lifted market sentiment.
The S&P 500 rose 1.7% to 4,438.26, its biggest daily gain since March. The Dow Jones Industrial Average was up 1.6% to 34,912.56 and the Nasdaq Composite advanced 1.7% to 14,823.43.
Materials and technology led the sectors, which were all in the green.
The 10-year US Treasury yield fell 3 basis points to 1.52%.
Initial jobless claims fell by 36,000 to 293,000 in the week ended Oct. 9 against market expectations of 320,000 first-time claims the lowest since the start of the COVID-19 pandemic. Initial claims increased before seasonal adjustment.
The producer price index rose 0.5% in September, less than the 0.6% increase expected after a 0.7% rise in August. Energy prices rose 2.8% and food prices increased 2%, but core producer prices excluding food and energy rose only 0.2%, well below the 0.5% gain expected.
Citigroup (C), Bank of America (BAC) and Morgan Stanley (MS) all posted higher quarterly earnings. Shares of Bank of America jumped 4.5% and Morgan Stanley traded higher by 2.5%, while Citi was up 0.8%.
Walgreens Boots Alliance (WBA) booked better-than-expected results in its fiscal Q4 amid higher comparable pharmacy and retail sales, and said it plans to invest $5.2 billion in raising its stake in a primary-care company VillageMD. Shares were up 7.4%, the most in the S&P 500 and the Dow.
UnitedHealth Group (UNH) reported higher Q3 earnings reflecting double-digit revenue growth for both of its business segments and raised its 2021 forecast. Shares jumped 4.2%, the second-highest gain on the Dow.
West Texas Intermediate crude oil rose 1.3% to $81.47 a barrel. Commercial crude oil inventories surged by 6.1 million barrels after a gain of 2.3 million barrels in the previous week, much more than the increase of 1.1 million barrels forecast in a Bloomberg survey.
In the metals markets, gold was up 0.2% to $1,798 per troy ounce, silver was up 1.8% to $23.59 an ounce, and copper gained 2.1% to $4.61 per pound.