The Dow Jones Industrial Average closed at an all-time high Thursday after weekly jobless claims fell to a pandemic low, suggesting solid labor-market strength heading into Friday's official U.S. jobs report.
The Dow, which also set an intraday high, rose for a fourth day. It finished up 318 points, or 0.93%, to 34,548, and the S&P 500 gained 0.82%. The Nasdaq advanced 0.37%.
The number of Americans filing for first-time unemployment benefits dropped 92,000 in the week ended May 1 to 498,000 - the lowest since the pandemic began last year. The figure compared with economists' forecasts of 530,000.
Traders keyed on the jobless-claims data ahead of the release Friday of the U.S. nonfarm payrolls report for April. Economists expect the U.S. economy to have added 975,000 jobs last month.
The jobless claims "read is another proof point that we’re one step closer to full economic recovery, sooner than some may have expected," said Mike Loewengart, managing director of investment strategy at E-Trade.
"So as we see some serious momentum building on the jobs front, all eyes will be on how this plays into action taken by the (Federal Reserve), if any."
Private employers in the U.S. added 742,000 jobs in April, payroll-processing company ADP said Wednesday. It was the most in seven months.
Stocks ended mixed Wednesday with the Dow closing at a record and the Nasdaq falling after an early rebound in tech shares faded.
Investors also remain focused this week on corporate earnings, which have been better than expected. According to FactSet, average profit growth for the S&P 500 companies that so far have reported results is 54%.
The Bank of England, meanwhile, said Thursday it slowed the pace of its bond buying and left rates unchanged. The decision from the BOE is potentially a game changer as it could mark the start of the long march to normalizing interest rate policy around the world.
The Federal Reserve has remained united in its message on inflation risks and its commitment to keeping interest rates at record lows for at least the next two years. The Fed's stance has added fuel to a stock market that already has been boosted by soaring corporate earnings.