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Weekly jobless claims rise more than expected

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Roblox ( RBLX ) slumps after bookings forecast cut

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Focus on next week's inflation readings

(Updates to close)

By David French

May 9 (Reuters) - The Dow Jones Industrial Average ended

up on Thursday, the seventh straight daily advance for the

benchmark, as all three major U.S. indexes gained after weekly

jobless claims data offered fresh hope for interest-rate cuts.

U.S. Federal Reserve policy has been the main driver of

investor sentiment in 2024. Renewed hopes the central bank will

cut rates have pushed the Dow to its biggest rally since

December.

Other benchmarks also benefited. After a flat day on

Wednesday, the S&P 500 resumed its upward trajectory and

closed above 5,200 points for the first time since April 9.

U.S. equity markets have clawed back losses incurred

during April on fears the Fed may ultimately raise interest

rates, and as tensions in the Middle East threatened to

escalate.

"We've almost had a full recovery of that," said Brad

Bernstein, managing director at UBS Private Wealth Management.

While next week's producer and consumer prices readings are

regarded as the next key signpost, other data have buoyed

investor rate-cut hopes.

The number of Americans filing new claims for unemployment

benefits increased more than expected to a seasonally adjusted

231,000 last week, data showed. Economists polled by Reuters had

forecast 215,000 claims.

Last week's data showing slowing job growth in April and job

openings falling to a three-year low in March had investors

pricing in one or two rate cuts by the Fed this year. Prior to

that, traders were pricing in just one rate cut.

Declining U.S. Treasury yields also supported stocks since

higher rates offer investors less risk while also making

borrowing to fuel growth more expensive. The yield on the

10-year note was at 4.46% on Thursday, down from 4.7% two weeks

ago.

"In the last few days, we've had some interesting events

which have really helped calm the bond market," said Bernstein,

noting factors including the U.S. Treasury and Fed announcing

plans to buy Treasuries.

Lower yields are particularly supportive for tech

megacap stocks, Apple ( AAPL ), Amazon.com ( AMZN ) and Meta

Platforms META.O> were all higher.

According to preliminary data, the S&P 500

gained 26.90 points, or 0.52%, to end at 5,214.57 points,

while the Nasdaq Composite gained 44.96 points, or

0.28%, to 16,347.72. The Dow Jones Industrial Average

rose 339.68 points, or 0.87%, to 39,396.07.

A majority of the 11 major S&P sectors rose, led by a rise

in the real estate index. Data center operator Equinix ( EQIX )

surged after its first-quarter results.

On the flip side, chip designer Arm Holdings dipped

as its full-year revenue forecast came in below expectations.

Bigger rival Nvidia ( NVDA ), which is still to report this

earnings season, slipped.

Roblox ( RBLX ) slumped after the video-gaming platform cut

its annual bookings forecast, in a sign that people were dialing

back spending amid an uncertain economic outlook and elevated

levels of inflation.

Robinhood Markets ( HOOD ) was lower, despite the online

brokerage beating estimates for first-quarter profit, thanks to

robust crypto trading volumes and rate hikes that boosted its

net interest revenue.

Meanwhile, Spirit Airlines ( SAVE ) jumped, having hit a

record low earlier this week.