US Stocks Bounce Back After Oil Prices Fall
US stocks are recovering from losses after the Federal Reserve's interest rate hike on Wednesday. The S&P 500 climbed 1.1% and the Dow Jones Industrial Average rose 357 points, or 0.7%, as of 12:12 p.m. Eastern time. Oil prices fell 2.5% to $103.15 per barrel, easing pressure from the bond market.
The Fed's decision to raise the short-term interest rate by a quarter of a percentage point was a signal that it is committed to getting inflation back under control. However, higher rates can undercut stock prices and slow economic growth in the short term. Some reports on Thursday suggested the US economy may be strong enough to withstand higher interest rates.
Stocks in the artificial-intelligence industry, such as Nvidia and Advanced Micro Devices, continued to rebound after their worldwide slide on Monday. Homebuilders like D.R. Horton and PulteGroup also rose despite a report showing fewer new homes were built last month than expected.