U.S. equities closed at new record levels Thursday after the Bank of England hinted at looser monetary policy next month and as earnings season kicked into full gear.
The Dow Jones industrial average closed at an all-time high for the third consecutive day, ending the day up 134.2 points, with Goldman Sachs, IBM and Apple contributing the most gains. Earlier, the blue-chips index rose more than 160 points.
The S&P 500 had its fourth consecutive record close, ending half a percent higher, led by financials. The Nasdaq composite had its sixth positive day of gains in seven, closing half a percent higher as Apple shares gained more than 2 percent.
"Clearly, you're getting a positive stimulus from [the BOE and earnings]," said Randy Frederick, managing director of trading and derivatives at Charles Schwab. "The market always tends to move ahead of these thing, and that's why I think you've seen the move higher over the past couple of days."
The United Kingdom's central bank kept interest rates unchanged, while market consensus was for a 25 basis point rate cut to 0.25 percent, which would've been the bank's first move since 2009.
"I certainly think the Bank of England did the right thing by keeping their powder dry. If they need to ease, they can do it," said Jack Ablin, chief investment officer at BMO Private Bank.
The BOE's meeting minutes said: "In the absence of a further worsening in the trade-off between supporting growth and returning inflation to target on a sustainable basis, most members of the committee expect monetary policy to be loosened in August."
"I think what they're trying to do is keep the markets calm," said Peter Cardillo, chief market economist at First Standard Financial. "The message is that it's business as usual. That's not to say they won't do anything [soon]."
Meanwhile, earnings season in the U.S. came in full swing, with JPMorgan Chase easily beating estimates and BlackRock posting results in line with expectations.
"It's hard to come up with a trend, but the early indications have been positive," said Kate Warne, investment strategist at Edward Jones. "If companies continue to deliver, then stocks will rise appropriately."
Shares of JPMorgan rose about 2 percent in afternoon trade, while BlackRock's stock slipped 0.2 percent..
Citigroup, Wells Fargo, and U.S. Bancorp will kick off the next wave of earnings before the bell Friday.
"If Citigroup comes out and they miss, then it starts to get people a little bit more concerned," said Robert Pavlik, chief market strategist and senior portfolio manager at Boston Private Wealth. "But i think as we move a little bit more into earnings season, we'll get some of the other banks falling in line."
The Dow Transports traded 1 percent higher Thursday, led by United Continental and American Airlines. Delta and CSX also helped the index, with better-than-expected quarterly results this week.
"Airlines have been doing better, that might help boost the Dow Transports up a little bit more," Pavlik said.
U.S. stocks closed mostly flat Wednesday, with the Dow and S&P holding near record highs.
Japanese social networking firm Line made its debut on the New York Stock Exchange Thursday at $42 per share, in the largest technology initial public offering of 2016. Shares of the Tokyo-based company jumped more than 30 percent after the offering, and closed up 26.6 percent. This was the sixth best debut in 2016.
On the data front Thursday, investors digested the latest reading of weekly jobless claims, which showed no change week over week. Meanwhile, the June reading of the producer price index showed an increase of 0.5 percent, above the expected 0.3 percent rise.
In a speech Thursday, Atlanta Fed President Dennis Lockhart said Brexit and uncertainty require the Federal Reserve to be patient in normalizing rates. Kansas City Fed President Esther George said in another speech the U.S. economy has been "relatively resilient."
St. Louis Fed President James Bullard and Dallas Fed President Robert Kaplan are also scheduled to speak Thursday.
Oil prices bounced back on Thursday, with U.S. crude settling 2.08 percent higher at $45.68 a barrel, a day after closing more than 4 percent lower.
U.S. Treasury yields rose, with the benchmark 10-year yield holding near 1.53 percent and the two-year yield trading around 0.68 percent.
The dollar traded slightly lower against a basket of currencies, with the euro near $1.11 and the yen around 105.39 . The pound, meanwhile, rose sharply against the greenback to trade near $1.33.
European shares rose broadly, with the Stoxx 600 index advancing 0.8 percent. Asian equities also gained, as Japan's Nikkei 225 rose 0.95 percent.
Major U.S. Indexes
The Dow Jones industrial average closed at an all-time high of 18,506.41, up 0.73 percent. This was the Dow's fifth consecutive day of gains for the first time since its seven-day winning streak ending March 21. Goldman Sachs was the biggest gainer, while UnitedHealth led the laggards.
The closed at a record 2,168.99, ending the day up 0.53 percent. The S&P hit a new intraday all-time high of 2,168.99 for a fourth consecutive day, with materials and industrial leading nine sectors higher and utilities the only decliner.
The Nasdaq composite closed up .57 percent for its sixth positive day in seven. The index hit its highest level of the year, back to December 31, 2015. Apple closed 2 percent higher with its best performance since May 16, when the stock closed up 3.71 percent.
Advancers were a step ahead of decliners on the New York Stock Exchange, with an exchange volume of 825 million and a composite volume of 3.4 billion in afternoon trade.
The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, traded lower at 12.8, after briefly hitting an 11-month low.
Gold futures for August delivery settled $11.40 lower at $1,332.20 per ounce.
On tap this week:
*Planner subject to change.
Friday
Earnings: Citigroup, Wells Fargo, US Bancorp, PNC, Shaw Communications
8:30 a.m. Retail sales, CPI, Empire State survey
9:15 a.m. Industrial production
10 a.m. Consumer sentiment; Business inventories
1:15 p.m. Minneapolis Fed's Kashkari and St. Louis Fed's Bullard in discussion