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* Weekly jobless claims unexpectedly rise
* GameStop gains on stock split
* Samsung results boost chipmakers
* Indexes up: Dow 0.93%, S&P 1.25%, Nasdaq 1.85%
July 7 (Reuters) - Wall Street's main indexes rose on
Thursday on expectations the U.S. Federal Reserve would ease the
aggressive pace of interest rate hikes later this year amid
growing concerns of a recession.
U.S. stock markets have stabilized in July after a brutal
sell-off in the first half against the backdrop of a surge in
inflation, the Ukraine conflict and the Fed's pivot away from
The benchmark S&P 500 index has risen 2.8% so far
this month, including session gains, after recording its
steepest first-half percentage drop since 1970.
Minutes from the central bank's June policy meeting, where
the Fed raised interest rates by three-quarters of a percentage
point, showed on Wednesday a firm restatement of its intent to
get prices under control.
However, Fed officials acknowledged the risk of rate
increases having a "larger-than-anticipated" impact on economic
growth and judged that an increase of 50 or 75 basis points
would likely be appropriate at the policy meeting in July.
"The (rate hike) expectations for the July meeting haven't
changed much, but the expectation later in the year is coming
down a little bit," said Michelle Cluver, portfolio strategist
at Global X ETFs
Though investors widely expect the Fed to hike rates by
another 75 basis points in July, expectations of peak terminal
rate next year have come down significantly amid growing worries
of a global economic slowdown.
Fed funds futures traders are pricing for the benchmark rate
to peak at 3.44% in March. Expectations before the June meeting
were that it would increase to around 4% by May. It is currently
Goldman Sachs forecast a 75 basis-point rate hike this
month, a 50 basis-point hike in September, and 25 basis-point
hikes in November and December.
A report on Thursday showed the number of Americans filing
new claims for unemployment benefits unexpectedly rose last week
and demand for labor is slowing with layoffs surging to a
16-month high in June.
A closely watched employment report on Friday is expected to
show nonfarm payrolls likely increased by 268,000 jobs last
month after rising by 390,000 in May.
At 12:07 p.m. ET, the Dow Jones Industrial Average
was up 287.57 points, or 0.93%, at 31,325.25, the S&P 500
was up 48.06 points, or 1.25%, at 3,893.14, and the Nasdaq
Composite was up 210.28 points, or 1.85%, at 11,572.13.
GameStop Corp rose 8.5% as the videogame retailer's
board approved a four-for-one stock split.
Intel Corp, Nvidia Corp and Qualcomm Inc
gained after South Korea's Samsung Electronics
turned in its best second-quarter profit since 2018,
driven by strong sales of memory chips.
The wider Philadelphia SE Semiconductor index climbed
Advancing issues outnumbered decliners by a 4.00-to-1 ratio
on the NYSE and by a 3.53-to-1 ratio on the Nasdaq.
The S&P index recorded two new 52-week highs and 29 new
lows, while the Nasdaq recorded 20 new highs and 44 new lows.
(Reporting by Amruta Khandekar and Bansari Mayur Karmdar in
Bengaluru; Additional reporting by Devik Jain, Editing by
Shounak Dasgupta and Anil D'Silva)