Big tech rally boosts US stocks

Wall Street ended sharply higher on Thursday in a broad-based rally led by Big Tech, as a truce in the debt-ceiling standoff in the US Congress relieved concerns of a possible government debt default this month.

Mega-cap stocks jumped with Apple up 0.9 percent and rising 1.2 percent, the biggest boosts to the S&P 500 and Nasdaq. Tesla and Google-parent Alphabet both rose more than 1 percent.

The US Senate took a step toward passing a US$480 billion increase in Treasury Department borrowing authority, which would put off another partisan showdown until December.

Uncertainty over the debt-ceiling negotiations was one concern investors cited in September as the S&P 500 logged its biggest monthly percentage drop since the onset of the coronavirus pandemic in March 2020.

“Today’s (market) is driven by a slight move in Washington towards rationality about being able to pay their bills, write some checks,” said Kim Forrest, chief investment officer at Bokeh Capital Partners in Pittsburgh.

Meanwhile, data showed the number of Americans filing new claims for jobless benefits dropped last week by the most in three months, suggesting the labour market recovery was regaining momentum as the latest wave of Covid-19 infections began to subside.

The closely watched monthly US jobs report is due on Friday.

“Today’s numbers reinforce the expectation that employment will take a significant step up in the coming months, and I think that’s positive for the economy,” said Brad Neuman, director of market strategy at Alger.

“The market climbed its wall of worry today as fears of a debt-ceiling impasse receded and hopes for an acceleration in employment gains were reinforced.”

The Dow Jones Industrial Average rose 0.98percent to end at 34,755 points, while the S&P 500 gained 0.83 percent to 4,400.

The Nasdaq Composite climbed 1.05 percent to 14,654. (Reuters)