U.S. stocks rose Thursday after better-than-expected earnings reports from Bank of America and other major companies.
The Dow Jones Industrial Average jumped about 395 points, or 1.1%. The S&P 500 gained 1.3% and the Nasdaq Composite added 1.4%.
Third-quarter earnings season rolled on Thursday with several big banks and Dow members reporting financial results before the bell.
Eight members of the S&P 500 reported earnings Thursday morning and all eight beat earnings-per-share expectations from Wall Street.
“So far, the overwhelming majority of large US companies have been able to generate higher profitability despite rising labor costs because sales growth has been so robust. We expect the same to be true in 3Q,” Mark Haefele, chief investment officer of UBS Global Wealth Management, said in a note Thursday.
Bank of America saw its shares rise in the premarket after beating earnings expectations. Morgan Stanley, Wells Fargo and Citigroup shares both ticked lower despite earnings beats.
Dow constituent UnitedHealth also gained after the companies’ quarterly results topped estimates and was the top performer on the blue-chip average.
Walgreens Boots Alliance shares ticked down even after the drugstore chain beat expectations. The company announced it would become majority owner of VillageMD with a $5.2 billion investment.
A lower-than-anticipated number of weekly jobless claims added to the positive market sentiment. Initial unemployment insurance claims last week totaled 293,000 – the first time the tally fell below the 300,000 level during the pandemic-era.
“We’re seeing fresh and welcome signs of improvement in the job market,” said Bankrate’s Mark Hamrick.
September’s producer price index was lighter than expected, also helping sentiment. Wholesale prices rose 0.5% from the month prior versus the 0.6% Dow Jones estimate.
—CNBC’s Michael Bloom contributed to this report.