A Wall Street Journal report said Trump has mulled picking Federal Reserve Chair Jerome Powell's replacement early, by September or October, after repeatedly criticising him for not cutting interest rates sooner. Traders now price in a nearly 25% chance of the Fed cutting rates in July, compared with 12.5% last week, according to CME Group's FedWatch tool.

The benchmark S&P 500 was trading 0.5% below its record peak, while the tech-heavy Nasdaq was about 0.7% below its all-time highs, with risk appetite revived by a truce in the Middle East conflict earlier this week. The Nasdaq 100, a subset of the Nasdaq composite index, touched an intraday record high. Economic data was mixed. The final reading from the United States (US) Commerce Department showed gross domestic product contracted 0.5% in the first quarter. Economists polled by Reuters had forecast a 0.2% contraction.

"A 0.5% contraction is worse than expected, but that really reflects how much imports overwhelmed exports in the first quarter, as businesses and consumers tried to get ahead of the tariff program," said Sam Stovall, chief investment strategist at CFRA Research.
Separately, a report for weekly jobless claims showed the number of Americans filing new applications for jobless benefits fell last week.
Fed San Francisco President, Mary Daly said she's seeing increasing evidence that tariffs may not lead to a large or sustained inflation surge, helping bolster the case for a rate cut in the fall, Bloomberg News reported.

The Personal Consumption Expenditures report on Friday, the Fed's preferred gauge of inflation, will be scrutinized to ascertain tariff-induced price changes in the US economy. At 15h11 CAT, the Dow Jones Industrial Average rose 149.52 points, or 0.35%, to 43,133.31, the S&P 500 gained 23.61 points, or 0.39%, to 6,115.77 and the Nasdaq Composite gained 83.54 points, or 0.42%, to 20,056.37.

Ten of the 11 major S&P 500 sub-sectors rose. Materials led gains with a 0.8% rise. On the flip side, real estate stocks lost 0.8%.
Nvidia rose 1% after scaling a fresh all-time high on Wednesday. Shares of sportswear company Nike edged up 0.8% ahead of its quarterly results.

Copper miners gained after the red metal's prices jumped to a three-month high. Freeport Mcmoran rose 6% and Southern Copper advanced 6.3%. Advancing issues outnumbered decliners by a 3.01-to-1 ratio on the New York Stock Exchange and by a 1.56-to-1 ratio on the Nasdaq.

The S&P 500 posted 23 new 52-week highs and 2 new lows while the Nasdaq Composite recorded 44 new highs and 29 new lows.

--Reuters--