NEW YORK, New York – U.S. stocks rallied sharply on Thursday, a day after the U.S. Federal Reserve broke with other central banks and paused its rate-hiking program.
“The key question for the market now is, can value and cyclical stocks catch up to growth and tech?” asked Dylan Kremer, co-chief investment officer at Certuity. “If it does, then that momentum has the ability to help grind the market higher,” Kremer told CNBC Thursday.
The European Central Bank on Thursday became the latest to hike rates, following similar decisions by the Bank of Canada and the Reserve Bank of Australia last week. The ECB raised rates 0.25 percent to 3.25 percent Thursday, the highest level in twenty-two years.
“The Governing Council’s future decisions will ensure that the key ECB interest rates will be brought to levels sufficiently restrictive to achieve a timely return of inflation to the 2 percent medium-term target and will be kept at those levels for as long as necessary,” the ECB said in a statement published Thursday.
The Dow Jones industrials jumped 428.73 points or 1.26 percent to 34,408.06.
The Standard and Poor’s 500 increased 53.25 points or 1.22 percent to 4,425.84.
The Nasdaq Composite climbed 156.34 points or 1.15 percent to close Thursday at 13,782.82.
Meanwhile, the Russell 2000 index showcased a stronger performance with a gain of 0.64 percent.
On the other hand, the NYSE COMPOSITE (DJ) index demonstrated significant strength, closing with a gain of 1.12 percent. The NYSE AMEX COMPOSITE INDEX also ended on a positive note, showing a gain of 0.34 percent.
The CBOE Volatility Index, commonly referred to as the VIX, saw a notable increase of 3.46 percent, reflecting a rise in market volatility.
Following Thursday’s rate hike by the ECB, the U.S. dollar sank as the euro jumped sharply, taking a broad range of other currencies with it.
The euro made significant gains against the US Dollar, with the EUR/USD pair increasing by 1.14 percent, reaching 1.0947. Meanwhile, the British Pound also showed strength against the U.S. dollar, as the GBP/USD pair recorded a gain of 0.95 percent, closing at 1.2782.
The USD/JPY (Japanese yen) pair ended the trading day at 140.244, showing a slight gain of 0.14 percent or 0.196.
The Canadian dollar surged to 1.3219, a gain of 0.78 percent or -0.01044.
British Pound / US Dollar (GBP/USD): The GBP/USD pair concluded the day at 1.27824, marking an increase of 0.95 percent or 0.01209.
The Swiss franc added 1.08 percent Thursday to 0.8912.
The Australian dollar jumped to 0.6886, registering an increase of 1.33 percent or 0.00906.
The New Zealand dollar advanced 0.50 percent to 0.00312 to 0.6237.
Declines across the board in Europe marked world stock markets trading on Thursday. The ESTX 50 PR.EUR index closed at 4,365.12, down by 10.86 points or 0.25 percent.
The Euronext 100 Index finished at 1,365.99, experiencing a decline of 2.33 points or 0.17 percent.
The German DAX index concluded the trading day at 16,290.12, experiencing a decline of 20.67 points or 0.13 percent.
In Paris, France, the CAC 40 closed at 7,290.91, down by 37.62 points or 0.51 percent.
The BEL 20 index in Brussels settled at 3,658.54, showing a decrease of 7.33 points or 0.20 percent.
The MOEX Russia Index closed at 2,222.51, down by 4.14 points or 0.19 percent.
In London, the FTSE 100 closed at 7,628.26 Thursday, showing a gain of 25.52 points or 0.34 percent.
The S&P/TSX Composite index in Toronto, Canada, closed at 20,027.35, showing a slight gain of 12.26 points or 0.06 percent.
In Latin America, the IBOVESPA index in Brazil registered a slight increase of 0.14 percent, while the IPC MEXICO index in Mexico exhibited a gain of 0.33 percent.
In Asia, the Nikkei 225 index ended the day at 33,485.49, registering a minor decrease of 16.93 points or 0.05 percent.
The Hang Seng Index in Hong Kong recorded a significant gain, closing at 19,828.92, with an increase of 420.50 points or 2.17 percent.
In mainland China, the SSE Composite Index finished at 3,252.98, marking a rise of 23.99 points or 0.74 percent. Meanwhile, the Shenzhen Index closed at 11,182.94, exhibiting an increase of 198.39 points or 1.81 percent.
In Australia, the S&P/ASX 200 concluded the trading session on Thursday at 7,175.30, showing a gain of 13.60 points or 0.19 percent. Meantime, the Australian ALL ORDINARIES index closed at 7,370.00, showing a gain of 15.80 points or 0.21 percent.
The STI Index in Singapore ended the trading session at 3,242.85, with an increase of 24.71 points or 0.77 percent.
In India, the S&P BSE SENSEX concluded the trading day at 62,917.63, experiencing a decline of 310.88 points or 0.49 percent. On the other hand, the NIFTY 50 in India concluded the trading session at 18,688.10, experiencing a decline of 67.80 points or 0.36 percent.
The IDX COMPOSITE in Indonesia closed at 6,713.79, with an increase of 14.08 points or 0.21 percent.
The FTSE Bursa Malaysia KLCI in Kuala Lumpur ended the day at 1,381.73, down by 3.69 points or 0.27 percent.
In New Zealand, the S&P/NZX 50 INDEX GROSS closed at 11,687.45 Thursday, showing a slight increase of 8.83 points or 0.08 percent.
The KOSPI Composite Index in Seoul, South Korea, concluded the trading session at 2,608.54, experiencing a decline of 10.54 points or 0.40 percent.
The TSEC weighted index in Taiwan closed at 17,334.98, with an increase of 96.84 points or 0.56 percent.
In the Middle East, Israel’s TA-125 index ended the day at 1,841.62 Thursday, showing a gain of 16.52 points or 0.91 percent.
Egypt’s EGX 30 Price Return Index closed at 17,881.50, with a slight increase of 8.20 points or 0.05 percent.