US stock indexes extended gains to trade more than 1 per cent higher on Thursday, as optimism was driven by upbeat earnings from Cisco and Walmart as well as robust economic data that underlined the strength of the domestic economy.
Cisco Systems Inc jumped 7 per cent, the most among the S&P and the Dow, after the network gear maker gave an upbeat sales forecast and said minimal sales exposure to China has helped cushion the impact from trade dispute.
Walmart Inc rose 2.6 per cent after it reported its best first-quarter same-store sales growth in nine years. The big box retailer also said prices for shoppers will rise due to higher tariffs on Chinese imports.
At 22.00 IST, the Dow Jones Industrial Average was up 297.01 points, or 1.16 per cent, at 25,945.03. The S&P 500 was up 39.37 points, or 1.38 per cent, at 2,890.33 and the Nasdaq Composite was up 119.61 points, or 1.53 per cent, at 7,941.76.
All the major S&P sectors were trading higher, with nine of them posting gains of more than 1 per cent.
“We are seeing a bounce back rally in markets and it is being driven by fundamentals, better-than-expected earnings and the possibility of lower interest rates,” said Bucky Hellwig, senior vice president at BB&T Wealth Management in Birmingham, Alabama.
“The strength of GDP for the second quarter is yet to be determined, but to the extent that there is a bullish outlook supported by data, that would help top line sales growth of US companies.” Strong data out of the United States soothed some fears of an economic slowdown that ratcheted up market expectations of an interest rate cut in the coming months.
The Commerce Department said US homebuilding increased more than expected in April, suggesting declining mortgage rates were starting to provide some support to the