US stocks witnessed a significant rebound on Thursday, following the previous day's sell-off that was triggered by the Federal Reserve's hawkish stance on interest rates. The Dow Jones Industrial Average (^DJI), which had endured 10 consecutive losing sessions, showed an increase of more than 1%. Simultaneously, the S&P 500 (^GSPC) rose by approximately 1%, and the tech-heavy Nasdaq Composite (^IXIC) rallied by more than 1%. This comeback comes after a harsh reaction the previous day when the Fed scaled back its expected number of rate cuts for next year to two, and Chair Jerome Powell indicated that even Wednesday's decision to cut rates by a quarter point was a "closer call." Markets interpreted these moves as a "hawkish cut" and responded accordingly, sending the S&P 500 and Nasdaq to their worst days since summer. Meanwhile, the blue-chip Dow is in the midst of its longest losing streak in 50 years, but it is still up over 12% this year.

Economic Front: Third Quarter GDP and Unemployment Claims

On the economic front, the third estimate for the third quarter US GDP revealed that the economy grew at an annualized rate of 3.1%, which is higher than the previous reading of 2.8%. This indicates a stronger economic performance than initially anticipated. Additionally, other data released on Thursday morning showed that 220,000 weekly unemployment claims were filed in the week ending December 14. This is a decrease from the 242,000 seen in the previous week and is below the 230,000 that economists had expected. These economic indicators provide valuable insights into the current state of the US economy and its potential trajectory.

Stock Market Sectors and Performance

All eleven sectors of the S&P 500 were in the green on Thursday. The Financials sector (XLF) led the way with a more than 1.6% surge. This indicates that investors have regained confidence in certain sectors of the market and are starting to allocate their funds more positively. The rebound in stock prices across different sectors suggests that the market is gradually recovering from the previous day's sell-off and is showing signs of stability. It also reflects the complex interplay between various economic factors and market sentiment.

Impact of Fed's Actions on Different Indices

The Federal Reserve's hawkish outlook and its decisions regarding interest rates have had a significant impact on different stock market indices. The Dow Jones Industrial Average, with its long losing streak, is now looking to break out of that funk on Thursday. The S&P 500 and Nasdaq Composite, which were hit hard the previous day, have shown signs of recovery. This shows that different indices respond differently to the Fed's actions, and investors need to closely monitor these movements to make informed investment decisions. The Fed's decisions not only affect short-term market trends but also have implications for the long-term performance of the stock market.