Stocks hit record on bets economy is pushing ahead

Companies that stand to benefit the most from a rebound in activity outperformed -- with financial and energy shares leading gains in the S&P 500. Caterpillar Inc., the world's biggest maker of mining and construction equipment, jumped alongside raw-material producers such as U.S. Steel Corp. and Nucor Corp. Banks rallied before the results of the Federal Reserve's stress tests, while Tesla Inc. extended its three-day advance to almost 10%.

The bipartisan legislation is expected to move through Congress alongside a separate bill that would spend trillions more on what Biden called "human infrastructure" that the GOP opposes. Earlier Thursday, Atlanta Fed President Raphael Bostic and his Philadelphia counterpart Patrick Harker urged more spending on infrastructure investment -- noting that it could boost U.S. productivity and growth.

"Infrastructure spending strengthens an already very strong economic growth outlook," said Jeff Buchbinder, equity strategist at LPL Financial. Those investments will "bolster the outlook for corporate profits and should keep this bull market going strong well beyond 2021," he added.

Data Thursday showed applications for U.S. state unemployment insurance fell slightly last week, though were higher than forecast, while orders for durable goods rose in May at the fastest pace since January.

Shares of the fastest-growing U.S. companies have stopped moving in lockstep with the cheapest stocks. The shift is evident from the correlation between the S&P 500 Pure Growth and Pure Value indexes during the past 200 trading days, which plummeted after setting an eight-year high in April 2020.

Elsewhere, the pound fell after the Bank of England pushed back against speculation that a surge in inflation means it's preparing to boost interest rates -- saying the economy still needs support.

These are some of the main moves in markets:

Stocks

- The S&P 500 rose 0.6% as of 4 p.m. EDT

- The Nasdaq 100 rose 0.6%

- The Dow Jones industrial average rose 1%

- The MSCI World index rose 0.6%

Currencies

- The Bloomberg Dollar Spot Index fell 0.2%

- The euro was little changed at $1.1935

- The British pound fell 0.2% to $1.3936

- The Japanese yen rose 0.1% to 110.84 per dollar

Bonds

- The yield on 10-year Treasurys was little changed at 1.49%

- Germany's 10-year yield declined one basis point to -0.19%

- Britain's 10-year yield declined four basis points to 0.74%

Commodities

- West Texas Intermediate crude rose 0.2% to $73.26 a barrel

- Gold futures fell 0.5% to $1,774.70 an ounce