Stock Market Today: S&P Hits New Highs as Rate Debate Heats Up

This article has been updated from 10:16 am to reflect midday market action.

NEW YORK (TheStreet) -- The heated debate between inflation hawks and doves is about to amp up a couple of notches as Federal Reserve Chair Janet Yellen gets her own forum to broadcast her economic views on Friday.

U.S. stocks were gaining midday Thursday, with the S&P 500 hitting a new record as investors anticipate Yellen's speech on Friday at the annual gathering of central bankers in Jackson Hole, Wyo. The event kicks off on Thursday and ends on Saturday.

Markets have been rising since Wednesday, brushing off the central bank's release of what was thought by many to be a more-hawkish-than-expected set of July meeting minutes. Stocks have sustained the momentum of the past six days, mostly on expectations that Yellen will emphasize the importance of sticking to an accommodative interest rate policy. Economists expect that she'll say it's not necessary right now to expedite the reversal of monetary policy, as inflation appears to be easing and wage growth remains muted.

"The S&P 500 appears to be on a mission to eclipse the 2000 level before considering the consequences of an uncontrolled advance," says S&P Capital IQ's managing director of U.S. equity strategy, Sam Stovall.

A number of economic releases on Thursday morning could provide more color heading into Yellen's speech.

U.S. existing home sales increased to a seasonally adjusted annual rate of 5.15 million units in July vs. the average estimate of 5.02 million units. The Philly Fed manufacturing index reached a three-year high in August.

The Markit Flash U.S. Manufacturing Purchasing Managers Index registered 58 in August, up sharply from 55.8 in July and the highest reading in more than four years.

U.S. initial jobless claims for last week arrived below expectations at 298,000 vs. the 300,000 consensus estimate.

In top corporate news Thursday, eBay (EBAY) was popping 5.9% to $56.51 amid reports that eBay is considering spinning off its PayPal business as early as next year.

Hormel Foods (HRL) was advancing 4.62% to $50.07 after the maker of Spam and Dinty Moore stew beat third-quarter earnings expectations by 3 cents, at 51 cents a share, driven by strong demand for pork and turkey.

Bank of America's (BAC) much-anticipated settlement with the U.S. Justice Department over fraudulent mortgage securities the bank sold to investors is less punitive than the $17 billion price tag suggests and doesn't address the wrongs it purports to remedy, says TheStreet's Dan Freed. Shares were up 1.51% to $15.76.

--By Andrea Tse in New York

Follow @AndreaTTse

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