Stocks Close Higher as Investors Weigh Fed Talks, Trade Court Ruling, and Mixed Jobs Data

U.S. stocks climbed Thursday as investors digested a full slate of macroeconomic updates, policy developments, and a high-level meeting between Federal Reserve Chair Jerome Powell and President Donald Trump.

The Dow Jones Industrial Average gained 117.03 points, or 0.28%, to close at 42,215.7. The S&P 500 rose 23.62 points, or 0.40%, to 5,912.17, while the Nasdaq Composite advanced 74.93 points, or 0.39%, ending at 19,175.9. The small-cap Russell 2000 finished 0.30% higher at 206.13.

Investor sentiment improved after the U.S. Court of International Trade struck down most of the Trump administration’s global tariffs, citing overreach under the 1977 International Emergency Economic Powers Act. The decision was broadly viewed as a win for businesses and markets, which had long grappled with the uncertainty introduced by the trade measures.

Midday: Powell and Trump Meet Amid Inflation, Rate Concerns

Midway through the trading session, attention turned to Washington, where Federal Reserve Chair Jerome Powell met with President Trump at the White House to discuss inflation, economic growth, and interest rate policy. According to Fox Business, Trump renewed his calls for lower interest rates, pressing Powell to “cut interest rates” and citing concerns over economic momentum.

The meeting also followed the release of the Fed’s most recent minutes, which reinforced the central bank’s concern about persistent inflation and its cautious approach to rate adjustments. Market participants interpreted the dialogue as a potential sign of political pressure on monetary policy, even as Powell emphasized the need for balance.

Morning: Mixed Economic Data Sets the Tone

At the open, markets reacted to a batch of economic reports that painted a mixed picture of the U.S. economy. Initial jobless claims rose to 240,000, exceeding both the 230,000 forecast and the previous week’s 227,000. Continued jobless claims also came in higher than expected at 1.919 million.

However, GDP data offered a modest upside surprise. The second estimate of first-quarter GDP showed a contraction of 0.2%, slightly better than the -0.3% expected. Additionally, Core PCE prices—a closely watched inflation gauge—came in at 3.4%, marginally below the 3.5% forecast, suggesting a potential softening of inflationary pressures.

Investor Positioning and Outlook

Elsewhere, money market fund assets in the U.S. dropped to $6.95 trillion, down roughly 10% from their early 2023 peak. The decline reflects shifting investor appetite amid rising interest rates and a hunt for higher-yielding alternatives.

The Trump administration also rolled back a 2022 Labor Department rule that discouraged cryptocurrency options in 401(k) plans. The move is expected to reopen the debate on digital assets in retirement portfolios and further aligns the administration with alternative asset markets.

As the trading week nears its close, investors remain focused on the Fed’s next steps and the policy signals emerging from both the central bank and the White House. Despite Thursday’s gains, market watchers continue to brace for further volatility as macroeconomic uncertainty lingers.