More gains for Big Tech push stocks back to record highs

Stocks are solidly higher in early trading on Wall Street, powered by more gains in big technology companies. Facebook and Apple joined the ranks of tech giants reporting surging profits in the first three months of the year. The S&P 500 added 0.7% in the early going Thursday. If the gains hold, the benchmark index would beat the all-time closing high it reached on Monday. There was also good news on the economy, including a report that the U.S. economy grew at a brisk 6.4% annual rate in the last quarter, and another drop in weekly claims for unemployment benefits. Treasury yields rose.

THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.

World shares advanced Thursday ahead of the release of U.S. economic growth data and following a speech by President Joe Biden outlining ambitious plans for beefing up early education and other family oriented policies.

London’s FTSE 100 jumped 0.7% to 7,013.40. In Paris, the CAC40 climbed 0.6% to 6,344.17. Germany’s DAX slipped 0.2% to 15,262.39 as a report showed weakening consumer confidence. The future for the Dow industrials rose 0.4% and that for the S&P 500 surged 0.6%.

U.S. growth in the January-March quarter could top 5% and accelerate even more to 10% or even more in the current April-June quarter as pent-up demand fuels spending.

In his speech Wednesday evening, the president ticked off details of some of his plan for $1.8 trillion in spending to expand preschool, create a national family and medical leave program, distribute child care subsidies and more.

The plan comes on top of his proposal for $2.3 trillion in spending to rebuild roads and bridges, expand broadband access and launch other infrastructure projects.

Bullish expectations for government spending and monetary stimulus lifted most markets.

Hong Kong’s Hang Seng rose 0.8% to 29,303.26 and the Shanghai Composite index picked up 0.5% to 3,474.90. Australia’s S&P/ASX 200 added 0.3% to 7,082.30. Markets in Tokyo were closed for a holiday.

In Seoul, the Kospi slipped 0.2% to 3,174.07 after Samsung Electronics, South Korea’s biggest company, reported its operating profit jumped 46% in the first quarter from a year earlier driven by increased sales of smartphones and televisions as its business continues to flourish amid the pandemic. But Samsung warned it expects weaker sales of its mobile devices going forward.

Benchmarks on Wall Street slipped Wednesday after the Federal Reserve said it was leaving its key interest rate unchanged near zero, where it’s been since the pandemic erupted, to help keep loan rates down to encourage borrowing and spending. It also said that it would keep buying $120 billion in bonds each month to try to keep longer-term borrowing rates low.

The yield on the 10-year Treasury, which influences interest rates on mortgages and other consumer loans, eased following the Fed’s statement but rose to 1.65% on Thursday from 1.61% late Wednesday.

Stocks initially got a bump from the Fed’s statement Wednesday. But the S&P 500 closed 0.1% lower at 4,183.18. The Dow Jones Industrial Average lost 0.5%, to 33,820.38. The tech-heavy Nasdaq gave up 0.3% to 14,051.03.

Smaller company stocks fared better than the bigger companies. The Russell 2000 index rose 0.1%, to 2,304.16.

Wall Street has been mostly grinding higher in recent weeks, pushing stock indexes to record highs, as the rollout of COVID-19 vaccinations, massive support from the U.S. government and the Fed, and a string of encouraging economic data fuel expectations for a stronger economy and solid corporate profit growth this year.

The expectations for a strong rebound and rising prices for oil, lumber and other commodities have also spurred concerns over inflation and the prospects for higher interest rates. Those worries pushed bond yields higher.

In its remarks, the Fed noted that the economy and job market have “strengthened.” It acknowledged that inflation has risen, but said it sees the increase as transitory. Fed officials have said they want to see inflation exceed their 2% annual inflation target before they’d consider raising rates.

In other trading Thursday, benchmark U.S. crude oil rose 50 cents to $64.36 per barrel in electronic trading on the New York Mercantile Exchange. It gained 92 cents to $63.86 on Wednesday. Brent crude, the international standard, advanced 54 cents to $67.32 per barrel.

The U.S. dollar rose to 108.96 Japanese yen. The euro fell to $1.2113 from $1.2128.