The S&P 500 was about 10 points shy of its record high of 3,027.98, as markets also turned optimistic about low-level trade talks between the United States and China. On Wednesday, the Fed announced a quarter percentage point cut in interest rates for the second time this year and said future reductions would be "largely data-dependent". Traders still see a 45% chance for another 25 basis point rate cut in October, according to CME Group's FedWatch tool.
"The market just continues to believe the Fed is going to be accommodative," said Robert Pavlik, chief investment strategist and senior portfolio manager at SlateStone Wealth LLC in New York. Trade officials from the two countries resumed face-to-face talks on Thursday for the first time in nearly two months, aiming to lay the groundwork for high-level negotiations planned in early October.
Healthcare stocks rose about 0.8% and were the second-largest boost to the S&P 500 after US House Speaker Nancy Pelosi released a proposal for drug pricing policy. At 11:40 am ET, the Dow Jones Industrial Average was up 118.31 points, or 0.44%, at 27,265.39, the S&P 500 was up 14.64 points, or 0.49%, at 3,021.37. The Nasdaq Composite was up 55.21 points, or 0.68%, at 8,232.60.