U.S. stocks extended gains Thursday while the dollar consolidate its recent upward run, as markets reacted to an impending tariff deal between Washington and London following a dour assessment of the trade war impact from the Federal Reserve.
Updated at 12:47 PM EST
Buy rockets
Stocks are moving firmly higher into the afternoon session after President Trump touted the potential of a trade deal with China and said markets are likely to rise once he's able to match that deal with an extension of its first-term tax cuts.
“This country will hit a point that you better go out and buy stock,” Trump said. “Now, let me tell you this, this country will will be like a rocket ship that goes straight up.”
The S&P 500 was last marked 83 points, or 1.47% higher on the session, with the Nasdaq rising 339 points, or 1.91%. The Dow gained 623 points while the mid-cap Russell gained 46 points 2.34%.
Updated at 10:58 AM EST
Agree to agree
President Trump unveiled details of a tariff agreement with the United Kingdom during a live event from the Oval Office, but the terms appeared to fall far short of the "comprehensive" package he had touted earlier this morning.
Trump said the "final details are being written up" but said Prime Minister Kier Starmer would fast-track U.S. goods into the UK and further reduce non-tariff barriers.
Stocks pared earlier gains following the President's statement, with the S&P 500 last marked 12 points, or 0.12% higher and the Nasdaq up 70 points, or 0.43%
Updated at 9:34 AM EST
Opening bounce
The S&P 500 rose 39 points, or 0.67% in the opening minutes of trading, with the Dow rising 220 points on the back of trade deal optimism heading into today's press event with President Donald Trump and UK Prime Minister Keir Starmer.
The Nasdaq, meanwhile, gained 176 points, or 1%, with AI chipmakers pacing the early gains.
"After the Fed left rates unchanged yesterday, Fed Chair Powell said that while employment and inflation risks were elevated, the economy is in a good place right now," said Chris Larkin, managing director for trading and investing at E*Trade from Morgan Stanley.
"Today’s modest jobless claims total didn’t signal any cracks in the labor market. But trade remains the primary story, and markets will likely take their cues from how upcoming negotiations unfold," he added.
Updated at 8:34 AM EST
Firm claims
Jobless claims fell by around 13,000 last week, with 227,000 Americans filing new application for unemployment benefits over the period ending on May 3.
Continuing claims, meanwhile, were also down, nudging 8,000 lower to 1.908 million but still near the highest levels since late 2021.
Updated at 7:45 AM EST
Deal or no deal?
U.K. government officials are pushing back on Trump's assertion that he's about to unveil a 'full and comprehensive' trade deal between the two countries, with reports suggesting it is actually a framework agreement for further talks.
Trump touted the agreement in a social media post this morning, and a photo-op is planned for later in the session. But details emerging from London suggest that many issues, including U.S. access to U.K. food markets and the elimination of tariffs on steel and aluminum, as well as the baseline global levy of 10%, remain unresolved.
Stocks are paring gains but are still set for a solid opening bell advance, with the S&P 500 called 50 points higher and the Nasdaq priced for a 240 point bump.
Updated at 7:06 AM EST
More cuts
The Bank of England lowered its benchmark Bank Rate by 0.25 percentage point following its regular policy meeting, taking it to 4.25%, citing the impact of tariffs on growth and inflation in Europe's second-biggest economy.
"There has been substantial progress on disinflation over the past two years, as previous external shocks have receded, and as the restrictive stance of monetary policy has curbed second-round effects and stabilised longer-term inflation expectations," the BoE said in a statement.
The pound was last marked modestly higher against the U.S. dollar at 1.3318 following the rate decision, which dovetails with an expected tariff agreement between Washington and London later today.
Stock Market Today
Stocks ended higher on Wednesday, with the S&P 500 rising around 0.43% by the close of trading, as reports of nascent trade talks between the U.S. and China offset the hawkish tone on rates from Fed Chairman Jerome Powell.
The central bank left its key lending rate unchanged at 4.375% for the third consecutive meeting this year as Powell hinted at potential stagflation risks in the world's biggest economy as a result of the ongoing trade uncertainty.
“We think right now the appropriate thing to do is to wait and see how things evolve,” Powell told reporters in Washington. “There’s so much uncertainty.”
Federal Reserve Chairman Jerome Powell hinted at stagflation risks to the world's biggest economy as the central bank held rates steady for its third consecutive meeting.ANDREW CABALLERO-REYNOLDS/AFP via Getty Images
Some of that could be put to rest today, with President Donald Trump set to unveil a narrow tariff agreement with the United Kingdom at 10 a.m. U.S. Eastern Time. The deal, however, will fall far short of a comprehensive package on $420 billion in trade the two nations transact each year.
Tech stocks are also set to get a boost from the Trump administration's decision to scrap Biden-era rules, set to come into effect next week, that would ban or limit the export of high-end AI technologies.
"The Biden AI rule is overly complex, overly bureaucratic, and would stymie American innovation," a Commerce Department spokeswoman told reporters. "We will be replacing it with a much simpler rule that unleashes American innovation and ensures American AI dominance."
Wall Street futures suggest solid opening bell gains across the board Thursday, with the S&P 500 called 60 points higher and the Dow Jones Industrial Average priced for a 355 point advance.
The tech-focused Nasdaq, meanwhile, is called 295 points higher with Nvidia (NVDA) , Intel (INTC) and Google parent Alphabet (GOOGL) pacing the premarket gains.
The U.S. dollar index, which tracks the greenback against a basket of six global currencies, jumped 0.47% to 100.087 while benchmark 10-year Treasury note yields were holding steady at 4.316%.
In overseas markets, Britain's FTSE 100 rose 0.34% in London amid news of the tariff pact, with investors also eyeing today's Bank of England rate decision later in the session.
The regionwide Stoxx 600, meanwhile, jumped 0.57% in midday trading in Frankfurt.
Overnight in Asia, Japan's Nikkei 225 ended 0.48% higher on the session, following on from last night's gains on Wall Street, while the regional MSCI-ex Japan benchmark rose 0.58% into the close of trading.
