U.S. stocks bounced higher after Thursday data signaled the economy was headed in the right direction, cementing bets for deeper interest rate cuts from the U.S. Federal Reserve.

The Nasdaq 100 index added 0.9 per cent, after Wednesday’s bout of selling knocked it off record highs. The S&P 500 rose 0.7 per cent, holding onto a gain that puts the benchmark on track for its eighth-consecutive weekly advance — its longest winning streak in more than five years.

Among the top gainers were Micron Technologies Inc. and Cintas Corp., which both rose more than six per cent after forecast-beating quarterly revenue. Salesforce Inc. was lifted by Morgan Stanley’s prediction the software firm would soar to a record.

The global bond rally cooled as the yield on the U.S. two-year hovered around 4.34 per cent, the 10-year edged up to 3.87 per cent.

Gross domestic product was revised lower to a 4.9 per cent annualized rise in the third quarter, trailing economists’ projections, the government’s third estimate of the figures Thursday showed. Initial applications for U.S. unemployment insurance rose last week by less than forecast, remaining near historic lows.

Numbers “were still in line with the narrative that a cooling economy will keep the Fed on track to cut rates in the not-too-distant future,” Chris Larkin, managing director of trading and investing at E*Trade from Morgan Stanley, said. “Right or wrong, that sentiment has played a big role in the market’s recent surge, even though the Fed has been doing its best to temper expectations.”

Following the data, swaps traders are betting on about six quarter point interest rate cuts from the U.S. central bank by the end of next year, well ahead of the three policymakers signaled last week.

Some market watchers blamed Wednesday’s swoon in U.S. stocks on so-called zero-day, or ODTE, options, noting that hefty “put” volumes likely led option holders to dump the underlying equities. But the broader picture of slowing inflation and rate-cut bets mean such speed bumps will be short-lived, many argue.

Citigroup Inc. strategists advised buying into pullbacks, adding investors should “expect volatility ahead, but with an eventual Fed pivot as a north star.”

Philadelphia Fed President Patrick Harker added to the rate-cut conviction Wednesday, saying it’s important that interest rates head lower, though he cautioned the central bank should not move too fast and not “right away.”

Nike Inc.’s earnings, due after market close should provide insights on the state of U.S. consumers. Friday brings U.K. GDP data, U.S. consumer sentiment and so-called core personal-consumption expenditures price index — the Fed’s preferred inflation gauge.

In commodities, oil prices retreated after three days of gains, as surging U.S. production tempered the threat of Houthi attacks on ships in one of the world’s most important waterways.

The U.S. dollar resumed a slide, falling against all of its Group-of-10 peers Thursday.

Key events this week:

• Nike earnings, Thursday
• Japan inflation, Friday
• U.K. GDP, Friday
• U.S. personal income and spending, new home sales, durable goods, University of Michigan consumer sentiment index, Friday

Some of the main moves in markets:

Stocks

• The S&P 500 rose 0.8 per cent as of 11:38 a.m. New York time
• The Nasdaq 100 rose 1 per cent
• The Dow Jones Industrial Average rose 0.6 per cent
• The Stoxx Europe 600 fell 0.2 per cent
• The MSCI World index rose 0.5 per cent

Currencies

• The Bloomberg Dollar Spot Index fell 0.5 per cent
• The euro rose 0.4 per cent to $1.0991
• The British pound rose 0.2 per cent to $1.2663
• The Japanese yen rose 1 per cent to 142.11 per dollar

Cryptocurrencies

• Bitcoin rose 0.5 per cent to $43,651.38
• Ether rose 2.2 per cent to $2,226.48

Bonds

• The yield on 10-year Treasuries advanced two basis points to 3.87 per cent
• Germany’s 10-year yield declined one basis point to 1.96 per cent
• Britain’s 10-year yield was little changed at 3.52 per cent

Commodities

• West Texas Intermediate crude fell 0.9 per cent to $73.53 a barrel
• Spot gold rose 0.6 per cent to $2,043.39 an ounce