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Stock market soars after brighter jobless claims report
By Caroline Valetkevitch. Shubham Batra, Shashwat Chauhan,
23 hours ago
NEW YORK, Aug 8 (Reuters) - U.S. stocks jumped on Thursday, with the Nasdaq and S&P 500 each ending more than 2% higher after jobless claims fell more than expected in the latest week, soothing worries the labor market was weakening too quickly.
Among the S&P 500's biggest gainers, shares of Eli Lilly (LLY.N), opens new tab jumped 9.5% after the drugmaker raised its annual profit forecast , and sales of its popular weight-loss drug Zepbound crossed $1 billion for the first time in a quarter.
Data showed the number of new applications last week for unemployment benefits fell more than expected .
"This was the data point for the week, so it took on added importance," said Paul Nolte, senior wealth advisor and market strategist for Murphy & Sylvest in Elmhurst, Illinois.
"Our reading on this is the labor market continues to be OK... The recession fears at this point are probably a little overblown."
Stocks had sold off sharply after last week's July U.S. jobs report sparked fears of a potential U.S. recession. Traders also cited an unwinding of positions of carry trades , where investors borrow money from economies with low interest rates to fund their bets in high-yielding assets elsewhere.
The Cboe Volatility index (.VIX), opens new tab , Wall Street's fear gauge, was down on Thursday.
"Once volatility gets going, it takes a while for it to calm down," said David Lundgren, chief market strategist and portfolio manager at Little Harbor Advisors in Marblehead, Massachusetts.
"The fact that we're up a lot doesn't necessarily mean the lows are in or that we're going straight up from here," he said. "But looking out three months, six months the tendency to experience above-average returns is very high."
The second-quarter earnings season is winding down, but investors are watching final results closely after some disappointments earlier in the reporting period.
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