US stocks rose to a record high on Wednesday after breaking out of a three-day lull.
The Standard & Poor's 500 index rose 44.91 points, or 0.9%, to 5,248.49 points. This is the index's first gain since it recorded its highest level ever on Thursday.
The Dow Jones Industrial Average jumped 477.75 points, or 1.2%, to 39,760.08 points, and the Nasdaq Composite Index rose 83.82 points, or 0.5%, to 16,399.52 points. They both finished a bit shy of their own records.
Merck's stock rose 5% after federal regulators approved its treatment for adults with pulmonary arterial hypertension, a rare disease in which blood vessels in the lungs thicken and narrow.
Cintas, a company that provides work uniforms and office supplies, was another force that pushed the S&P 500 higher. The stock jumped 8.2% after announcing stronger profits in the fourth quarter than analysts expected.
Meanwhile, shares of Trump Media and Technology Group continued their wild run and rose an additional 14.2%. The company behind money-losing platform Truth Social has achieved success beyond what critics say is rational, as fans of former President Trump continue to push it to the top.
Robinhood Markets shares rose 3.7% after unveiling its first credit card, which is intended for its gold members who pay subscriptions, along with other new products.
On the losing end of Wall Street was Nvidia, which fell to its second straight loss after rising 91% for the year so far. It fell 2.5%, as some investors may have taken profits before closing their books in the first quarter of the year. Nvidia has been one of the big winners in the Wall Street frenzy around artificial intelligence.
GameStop stock fell 15% after reporting profits in the fourth quarter and declining revenues from the previous year. It's the original meme stock, predating Trump Media by years. Its price has often moved based on the sentiment of investors with smaller pockets than on traditional fundamentals such as earnings and revenue.
In the bond market, Treasury yields fell on a day when there were few economic reports to turn things around.
The yield on the 10-year Treasury note fell to 4.19% from 4.23% late Tuesday.
The highlight of the week for the bond market will likely come on Friday, when the US government releases its latest monthly update on US consumer spending. It will include the measure of inflation that the Fed prefers to use when setting interest rates.
US bond and stock markets will be closed on that day for Good Friday. This could lead to some speculative trading on Thursday. This will be the last trading day of the first quarter of the year, which could further complicate matters.
The S&P 500 is on track for its fifth straight win and has been rising since late October. The US economy has remained remarkably resilient despite rising interest rates to control inflation. In addition, the Federal Reserve appears poised to start cutting interest rates this year because inflation has retreated from its peak.
But critics say a wide range of companies would need to deliver strong earnings growth to justify big price moves. Progress on reducing inflation has also become more difficult recently, with reports this year coming in hotter than expected.
However, the broad expectation among traders is that the Fed will start cutting its key interest rate in June.
Stocks generally tend to do best when more than half of the world's central banks cut interest rates, according to Ned Davis research. The world is not there yet, but many central banks, including the Swiss Bank, have already started cutting interest rates recently, and this could happen later this year.
In overseas stock markets, indicators were mixed across Europe and Asia.
Chinese stocks were among the worst performers. Shares fell 1.4% in Hong Kong and 1.3% in Shanghai.
Choi writes for the Associated Press. AP writers Matt Ott and Ellen Kurtenbach contributed to this report.
