NEW YORK — A surge in banks and other financial stocks that stand to benefit from higher interest rates lifted U.S. indexes Thursday. The dollar climbed to its strongest level in more than a decade against other currencies, and the price of gold sank on expectations that the Federal Reserve will follow up Wednesday’s rate increase with several more next year.
KEEPING SCORE: The Standard & Poor’s 500 index rose 9 points, or 0.4 percent, to 2,263 as of 3 p.m. Eastern time. It has made up about half of its loss from the prior day, which was its worst in two months.
The Dow Jones industrial average rose 75 points, or 0.4 percent, to 19,868. Earlier in the day, it climbed within 50 points of crossing above the 20,000 threshold for the first time. The Nasdaq composite rose 21 points, or 0.4 percent, to 5,458. Earlier in the day, it rose above its record closing level of 5,463.83.
GO GREENBACK: The ICE U.S. Dollar index, which tracks the value of the dollar against the euro, Japanese yen and four other currencies, jumped 1.2 percent and touched its highest level since 2002.
The dollar’s value has been generally climbing since 2014 because the U.S. economy is in better shape than others around the world, even with U.S. growth only modest. The dollar is jumping more now after the Federal Reserve raised short-term interest rates on Wednesday for just the second time in a decade and indicated three more increases may be on the way in 2017.
The dollar rose to 117.98 Japanese yen from 116.37 late Wednesday, following up on a 1 percent jump. The euro fell to $1.0419 from $1.0557, and the British pound fell to $1.2430 from $1.2596.
BANKING ON BIGGER PROFITS: Financial stocks in the S&P 500 jumped 1.3 percent, far more than any of the other 10 sectors that make up the index. Higher interest rates could help banks reap bigger profits from making loans. Bank of America rose 60 cents, or 2.6 percent, to $23.27.
MOSTLY HIGHER MARKET: Nearly three stocks rose for every two that fell on the New York Stock Exchange, and nine of the 11 sectors that make up the S&P 500 index climbed.
Stocks that pay big dividends lagged behind the rest of the market on fears that higher interest rates will push income investors away from them and into bonds. Real-estate stocks in the S&P 500 fell 0.4 percent.
BOND YIELDS: The yield on the 10-year Treasury note ticked up to 2.59 percent from 2.57 percent late Wednesday, and it earlier was above 2.60 percent. The two-year Treasury yield fell to 1.26 percent from 1.27 percent after earlier touching its highest level since the summer of 2009. The 30-year Treasury yield fell to 3.15 percent from 3.18 percent.
TAKING OFF: Delta Air Lines rose 95 cents, or 1.9 percent, to $50.77 after it told analysts that passenger revenue trends aren’t down as much this quarter as earlier feared and that it sees “good momentum” into 2017. It expects a key revenue measure to be down 3 percent this quarter from a year earlier. It had earlier forecast a drop of 3 percent to 5 percent.
Alaska Air Group rose 4.7 percent, United Continental Holdings rose 3.2 percent and American Airlines Group rose 1.6 percent.
MARKETS ABROAD: In Europe, Germany’s DAX rose 1.1 percent, France’s CAC 40 gained 1 percent and Britain’s FTSE 100 rose 0.7 percent. In Asia, Japan’s Nikkei 225 index gained 0.1 percent, Hong Kong’s Hang Seng fell 1.8 percent and South Korea’s Kospi was virtually flat.
ENERGY: Benchmark U.S. crude slipped 14 cents to settle at $50.90 a barrel on the New York Mercantile Exchange. Brent crude, the international standard, rose 12 cents to $54.02 a barrel in London. Natural gas fell 10.6 cents to $3.434 per 1,000 cubic feet, and wholesale gasoline rose nearly a penny to $1.54 per gallon.
