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U.S. stocks climbed Thursday, extending gains after Federal Reserve officials signaled they would be willing to ease monetary policy to help prop up the economy. Meanwhile, investors snapped up shares of Slack (WORK), the latest Silicon Valley darling to hit the public markets.
The S&P 500 (^GSPC) rose 0.95%, or 27.72 points, and clinched a new closing high of 2,954.18 points. Shortly after market open, the index reached an all-time intraday high of 2,956.2.
The Dow (^DJI) rose 0.94%, or 249.17 points, led by shares of United Technologies (UTX) and Caterpillar (CAT). The Nasdaq (^IXIC) advanced 0.8%, or 64.02 points, after an earnings beat from Oracle (ORCL) Wednesday evening set off a rally in tech stocks overnight.
Treasury yields declined across the curve. Earlier in the session, the U.S. 10-year yield fell as many as 5 basis points to 1.9719% after the Fed suggested it could cut interest rates soon. This marked the first time since November 2016 that the 10-year yield dipped below 2%, according to Bloomberg data.
Investors on Thursday continued to digest commentary from Federal Reserve officials leaning toward looser monetary policy amid rising “uncertainties” about the economic outlook. In their statement, Federal Open Market Committee (FOMC) members decided on Wednesday to keep benchmark interest rates unchanged.
On Thursday, the Bank of England (BOE) also held the headline U.K. borrowing rate unchanged at 0.75%. Like the FOMC in describing the U.S. economy, the BOE’s Monetary Policy Committee (MPC) pointed to softening in U.K. economic conditions.
“Underlying growth in the United Kingdom appears to have weakened slightly in the first half of the year relative to 2018 to a rate a little below its potential,” the MPC said in a statement.
The MPC also called out the impact of global trade tensions to the outlook. “Trade concerns have contributed to volatility in global equity prices and corporate bond spreads, as well as falls in industrial metals prices,” it said.
Amid a confluence of concerns, the MPC cuts its growth forecast for the U.K. in the second quarter of 2019 to flat for the period. Last month, it foresaw growth of 0.2% for the second quarter.
Meanwhile, crude oil prices surged after an Iranian missile shot down a U.S. military surveillance drone over the Straight of Hormuz Thursday morning. U.S. officials reportedly said this took place over international airspace, while Iran’s Revolutionary Guard said it took place over international airspace in the Strait of Hormuz, a major passageway for transporting oil.