US stocks rally on Senate debt-ceiling extension deal

US stock markets closed higher on Thursday, October 7, pulled up by gains in the technology sector as positive sentiments grew after the Senate secured a crucial debt-ceiling extension deal.

The S&P 500 was up 0.83% to 4,399.76. The Dow Jones rose 0.98% to 34,754.94. The NASDAQ Composite gained 1.05% to 14,654.02, and the small-cap Russell 2000 rose 1.59% to 2,250.09.

Senate majority leader Chuck Schumer said that lawmakers secured a significant deal to extend a short-term debt limit, allowing the Treasury Department to borrow up to US$480 billion. The truce eased worries over a possible government default. The negotiations were on for over a week.

On Thursday, the Labour Department said that jobless benefits claims fell to a three-month low last week, showing a steady labour market recovery. New claims fell by 38,000 to 326,000 last week.

Meanwhile, the S&P 500 index saw its highest percentage drop in September since March 2020.

Consumer discretionary and basic material stocks were the top movers on the index. Ten of the eleven sectors of the index remained in the positive territory. The utility segment stayed flat.

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Helen of Troy Limited (HELE) stock gained 5.81% after reporting quarterly results on Thursday. Its net income came in at US$51.31 million on revenue of US$475.22 million in Q2 FY22. It also raised its fiscal 2022 net sales forecast to between US$2.02 billion and US$2.06 billion.

Tilray, Inc. (TLRY) stock was up 3.20% after its net revenue surged by 43% YoY to US$168 million in Q1, FY22. It reported a net loss of US$34.6 million in the same period.

US-listed Chinese stocks rallied after media reports claimed that President Joe Biden and Chinese President Xi Jinping might hold a virtual summit by the end of this year.

The news comes a day after US national security advisor Jake Sullivan and his Chinese counterpart Yang Jiechi held a meeting in Zurich, Switzerland, on Wednesday. Alibaba Group Holding Limited (BABA), NIO Inc. (NIO), and Baidu, Inc. (BIDU) rose 8.16%, 6.94%, and 4.76%, respectively.

In the consumer discretionary sector, Home Depot, Inc. (HD) increased by 2.24%, Nike, Inc. (NKE) rose 2.16%, and Lowe's Companies, Inc. (LOW) rose 2.13%. Target Corporation (TGT) and Dollar General Corporation (DG) advanced 1.68% and 1.21%, respectively.

In material stocks, Linde PLC (LIN) rose 1.29%, Air Products and Chemicals, Inc. (APD) rose 1.25%, and Freeport-McMoran, Inc. (FCX) gained 8.25%. Dow Inc. (DOW) and PPG Industries, Inc. (PPG) gained 2.11% and 2.55%, respectively.

In the technology sector, Apple Inc. (AAPL) rose 1.11%, NVIDIA Corporation (NVDA) rose 2.34%, and Adobe Inc. (ADBE) gained 1.70%. Cisco Systems, Inc. (CSCO) and Broadcom Inc. (AVGO) gained 2.03% and 1.20%, respectively.

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Consumer discretionary and basic material stocks were the top movers on the S&P 500 index.

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Ten of the eleven sectors of the S&P 500 index remained in the positive territory. The utility segment stayed flat. 

Also Read: Helen (HELE), ConAgra (CAG) raise sales guidance after solid results

Futures & Commodities

Gold futures were down 0.34% to US$1,755.85 per ounce. Silver increased by 0.35% to US$22.610 per ounce, while copper rose 2.43% to US$4.2482.

Brent oil futures increased by 1.64% to US$82.41 per barrel and WTI crude was up 1.82% to US$78.84.

Bond Market

The 30-year Treasury bond yields was up 2.44% to 2.128, while the 10-year bond yields rose 3.33% to 1.575.

US Dollar Futures Index decreased by 0.05% to US$94.225.