The S&P 500 ended Thursday near flat, as investors grappled with fears of rising rates and worries about a ballooning U.S. deficit. The 30-year Treasury yield hit its highest since October 2023 as lawmakers passed a bill that investors fear could worsen the U.S. deficit.

The Dow Jones Industrial Average slipped 1.35 points, closing at 41,859.09. The S&P 500 lost 0.04% and ended at 5,842.01, while the Nasdaq Composite advanced 0.28% and settled at 18,925.73.

In a party line vote early Thursday, House members approved the bill that includes lower taxes and additional military spending. The measure — which now goes to the Senate — could increase the U.S. government's debt by trillions and raise the deficit at a time when fears of a flare-up in inflation due to Trump tariffs are already weighing on bond prices and boosting yields. The Congressional Budget Office puts the price tag for bill at nearly $4 trillion.

"Short term, the tax bill is good for the economy. It is going to boost GDP growth in 2026. It reduces taxes for lots of people, it increases spending, especially on defense, and so those things are stimulative to the economy and are going to boost GDP growth," said Jed Ellerbroek, portfolio manager at Argent Capital Management, in an interview with CNBC.

However, he noted that in the longer term, the measure adds to the deficit and it's bad news for the market.

"Yields are going higher, which means prices are going down because Treasurys are becoming incrementally less appealing and trustworthy, as our budget deficit stays extremely high for a very long period of time with no signs of it going back to normal," Ellerbroek added.

The 30-year Treasury bond yield on Thursday traded at levels not seen since 2023, climbing as high as 5.161%, before retreating later in the session. The benchmark 10-year Treasury note yield also backed off its high of the day. The increase in long-term rates, which are benchmarks for consumer loans, could pressure an economy already feeling the weight of Trump's recently implemented universal tariffs.

A poor auction for 20-year Treasury debt helped fuel the spike in yields and the sell-off in stocks on Wednesday. Investors' appetite for Treasurys could worsen if this bill passes the Senate.

S&P 500 closes little changed

The S&P 500 closed little changed on Thursday afternoon.

The market benchmark slipped 0.04% to close at 5,842.01. The Dow Jones Industrial Average shed about 1 point and finished at 41,859.09. The Nasdaq Composite, on the other hand, added 0.28% to settle at 18,925.73.

— Lisa Kailai Han

Fed's Waller expects interest rate cuts in second half

Federal Reserve Governor Christopher Waller said Thursday he expects the central bank to lower interest rates later this year after fiscal and trade policy impacts become clearer.

"If we can get the tariffs down closer to 10% and that's all sealed down and delivered somewhere by July, then we're in good shape for the second half of the year," Waller said in a Fox Business interview. "Then we're in good position for the Fed to kind of move with rate cuts through the second half of the year."

Financial markets don't expect the Fed to resume cutting until September as uncertainty over tariffs, inflation and the pace of economic growth lingers. Waller said company leaders to whom he has spoke said they can live with the current 10% tariff regime, but "can't deal" with higher rates.

— Jeff Cox

Morgan Stanley sticks to 12-month S&P 500 target translating to 11% rise for index

Stocks are likely to move upwards from here as long as the U.S. economy remains relatively healthy, Morgan Stanley wrote in a note from Wednesday.

"From our perspective, the level of tariffs announced on 'Liberation Day' was so dramatic, it led to what can only be described as capitulatory price action," equity strategist Michel Wilson said. "As a result, we think that the price lows are in assuming we don't experience a deep recession (our bear case)."

In the same note, Wilson reiterated his 12-month S&P 500 price target of 6,500, which implies an 11% rise for the benchmark.

"We have not adjusted our target throughout the recent correction, and reiterate that its achievability is more likely by the middle of 2026 versus the end of 2025 given the magnitude of the 1H drawdown and the lagged impacts of tariff uncertainty on earnings over the next couple of quarters," he added.

Read the full story here.

— Lisa Kailai Han

BMO Capital Markets recommend investors 'maintain their discipline' as stocks move upward

BMO Capital Markets recommended investors not sell in haste, as the investment firm believes that stocks will ultimately trend upward.

In a Wednesday note, the firm's chief investment strategist Brian Belski commented on his optimism that the stock market could soon recover to its prior highs.

"Given that the S&P 500 has rebounded nearly 19% from its April 8 closing low, we have continued to view the drawdown that began in mid-February as a normal and much needed bull market correction, despite the fact that some market participants remain skeptical and a few still expect a retest and possibly a new 2025 price low," he wrote.

Belski noted that most corrections have bottomed within 83 days and recovered to prior highs within 111. Returns also tended to perform better than the initial recovery, averaging 29.3% over the subsequent year.

"All along we have recommended that investors maintain their discipline because we continue to believe that the path of U.S. stock prices remains higher," the strategist added.

— Lisa Kailai Han

Citi expects growth to weaken in second half of 2025

Citi expects a worst economic outlook for the second half of the year.

The bank attributed this partially to U.S. consumers and firms frontloading their spending to get ahead of tariffs.

"As the full effects of the tariffs come online — likely over the next few months — demand could face a double blow. The tariffs could reduce real purchasing power, and in addition, frontloaded purchases will be 'paid back,'" global chief economist Nathan Sheets wrote in a Wednesday note. "As such, we view the current period as still the 'calm before the storm,' and we expect growth in the second half of the year to weaken."

— Lisa Kailai Han

Ackman's Pershing Square added a position in Amazon in April

Bill Ackman's Pershing Square built a position Amazon in April, according to an investor call Thursday, CNBC's Leslie Picker reports.

The firm said it had been monitoring Amazon for a while and took advantage of market turmoil to add the company to its portfolio. Pershing did not disclose the type of investment, the size of its stake or if it planned to continue building up its position. The move does not appear to be an activist investment.

Shares of Amazon moved higher after the announcement and were last up 1.6% on the day.

— Jesse Pound, Leslie Picker

Hinge Health pops 19% in NYSE debut

Shares of Hinge Health surged 19% on Thursday in their debut on the New York Stock Exchange.

The stock opened at $39.25, or 23% above its IPO price of $32. The company raised around $273 million in its initial public offering, selling 8.52 million shares out of the 13.7 million shares available in the total offering.

Hinge Health, founded in 2014, uses software to help patients treat chronic pain and acute musculoskeletal injuries, as well as rehabilitate after surgery.

"Health care is tough, absolutely, but we're very different from any of the digital health companies that have come before," Hinge CEO Daniel Perez said on CNBC's "Money Movers" Thursday. "Our technology is actually automating the delivery of care itself, and that's why a lot of investors have been so interested in Hinge Health."

— Ashley Capoot, Lisa Kailai Han

Long-term interest rates will continue to drive markets this year, Wolfe Research says

A spike in longer-term yields has driven the recent equity selloff. Going forward, Wolfe Research expects this trend to continue.

"Not shockingly, the long-term U.S. fiscal situations is on an unsustainable path with spending levels YTD surprising to the upside again, with only 2020/2021 trends likely to be worse when the U.S. reaches its September fiscal year-end," wrote Chris Senyek, the firm's chief investment strategist, in a Thursday note.

"Our sense is bond vigilantes are likely to start 'pushing back' on this unsustainable long-term outlook encapsulated in the tax bill working its way through Congress by sending long-term yields higher," Senyek continued. "With a large wall of maturities set to roll off over the coming year, uncertainty on the inflation outlook and pace at which the Fed cuts, the path of long-term interest rates are likely to continue to be major drivers of markers over the remainder of the year."

— Lisa Kailai Han

Bulls outnumbered bears in latest weekly AAII survey for first time since January

The percentage of individual investors who said they are bullish about the outlook for stocks over the next six months surpassed those who are bearish for the first time since late January, according to the latest weekly survey from the American Association of Individual Investors.

Optimists rose to 37.7% of those polled, up from 35.9% last week and the first time above the long-term, historical average of 37.5% also since late January.

Bearish investors, who accounted for 61.9% of the survey as recently as early April, dropped to 36.7% this week, down from 44.4% last week. Pessimism is still above the long-run historical average of 31.0% for the for the 25th time in 27 weeks.

Investors who said they're neutral on the market climbed to 25.6% this week from 19.7% last week, below its historical average of 31.5% for the 44th time in 46 weeks.

— Scott Schnipper

See the stocks moving midday

These are some of the stocks making notable midday moves:

• Urban Outfitters — The retailer surged 21.4% on a stronger-than-expected earnings report for the first quarter. Urban earned $1.16 per share on revenue at $1.33 billion. Analysts surveyed by LSEG penciled in earnings per share of 84 cents and $1.29 billion in revenue.
• Snowflake — The data storage stock rallied 11.4% after first-quarter earnings surpassed Wall Street's predictions. Snowflake earned 24 cents, excluding items, on $1.04 billion in revenue. Analysts anticipated 21 cents in earnings per share and $1.01 billion in revenue.
• Seagate Technology — The data storage company saw shares jump more than 5% after the firm announced a $5 billion share repurchase plan at its investor day. The buyback program will carry through the fiscal year ending in 2028, the company said.

See the full list here.

— Alex Harring

10 stocks in the S&P 500 trade at new 52-week lows

10 stocks in the S&P 500 traded at new 52-week lows on Thursday.

Tickers that hit this milestone included:

• Conagra Brands trading at lows not seen since February 2019
• Campbell Soup Company trading at lows not seen since February 2019
• General Mills trading at lows not seen since April 2020
• Kraft Heinz trading at lows not seen since April 2020
• Erie Indemnity Company trading at levels not seen since February 2024
• IQVIA Holdings trading at lows not seen since June 2020
• Enphase Energy trading at lows not seen since April 2020
• Alexandria Real Estate Equities trading at lows not seen since February 2014
• Healthpeak Properties trading at lows not seen since March 2024
• AES Corporation trading at lows not seen since March 2020

On the other hand, shares of GE Vernova were trading at all-time highs.

— Christopher Hayes, Lisa Kailai Han

Canada Goose rally was fueled by short-covering, analyst says

Wednesday's post-earnings surge for Canada Goose Holdings said more about investor positioning than newfound confidence in the apparel brand, according to Williams Trading analyst Sam Poser.

"[Wednesday's] stock price surge was likely driven by short covering. GOOS' short interest exceeded 20% of the float, and better than expected results, for whatever reason it occurred, shook the shorts," Poser said in a note to clients.

Canada Goose's fiscal fourth-quarter results beat estimates on the top and bottom lines, according to FactSet, and the U.S.-traded shares rose more than 19% on Wednesday. However, Poser downgraded the stock to sell from hold.

"The 4Q25 results are more about weather, than about fundamental improvement in the brand or company," Poser said.

— Jesse Pound

Home construction fund paces for 4th straight daily loss

On Thursday, the iShares U.S. Home Construction ETF (ITB) paced for its fourth straight daily loss.

The exchange-traded fund fell 6.6% on the week. This would be its worst week since December 20, 2024, when it fell 7.53%.

The fund was led to the downside by losses in Hovnanian, Dream Finders Homes, Masterbrand and Eagle Materials, all of which were down more than 11% week to date.

— Gina Francolla, Lisa Kailai Han

Solar exchange-traded fund paces for worst day of the year

The Invesco Solar ETF (TAN) was pacing for back-to-back losses and its fourth negative session in the past five.

The exchange-traded fund plummeted 8% on Thursday, putting it on pace for its worst daily performance since November 6, 2024, when it fell 10.86%.

Solar stocks were broadly lower over concerns that the Republican tax bill would terminate key clean energy credits. Solar stock Sunrun stumbled 38%, pacing for its worst day on record back to its 2015 IPO.

— Nick Wells, Spencer Kimball, Lisa Kailai Han

Economic growth rebounded in May, while prices saw multi-year highs

Activity in both the services and manufacturing sectors rebounded more than expected in May, but so did prices as tariffs began taking their toll, S&P Global reported Thursday.

The firm's flash indexes from purchase managers showed readings of 52.3 for both sectors, representing the share of companies seeing expansion. Economists surveyed by Dow Jones had been looking for 50.6 on services and 49.8 for manufacturing.

Following a pullback due to tariff concerns, new orders saw a rise, with manufacturing showing a 15-month high.

However, the report showed price increases at the fastest pace since August 2022, a period during which supply chain issues along with fiscal and monetary easing pushed inflation to its highest in 40 years. Price increases were "overwhelmingly linked to tariffs," the report said, though it also noted that sentiment was boosted after President Donald Trump backed off the most severe levies.

— Jeff Cox

Long-term Treasury fund is down nearly 10% since April 4

Investors who bought into a major bond fund after the April 2 tariff rollout are now sitting on significant losses.

The price of the iShares 20+ year Treasury Bond ETF (TLT) is down 8% since April 2, and down 9.6% since April 4, which was where a brief tariff rally for the bond market peaked. The fund has roughly $48 billion in assets.

Bond prices fall as yields rise, and the 30-year U.S. Treasury yield is trading at its highest level since October 2023.

The good news is that funds like TLT do pay income to investors, meaning that the total return numbers will show smaller losses over this period. The latest 30-Day SEC yield for TLT is 4.90%.

— Jesse Pound

Stocks slide on Thursday morning

Stocks slipped to start Thursday's session.

The Dow Jones Industrial Average fell 92 points, or 0.2%. The S&P 500 and Nasdaq Composite shed 0.1% and 0.2%, respectively.

— Lisa Kailai Han

Stocks making the biggest moves before the bell: Advance Auto Parts, Snowflake and more

These are the stocks moving the most in premarket trading:

• Advance Auto Parts — Shares surged more than 30% after Advance Auto Parts topped first-quarter expectations.
• Snowflake — Shares jumped 8% after the cloud-based data storage company posted solid earnings in its first quarter.
• Lumen Technologies — The telecommunications stock rallied 9% after AT&T agreed to acquire substantially all of Lumen's mass markets fiber internet connectivity business.

Read the full list of stocks moving here.

— Sarah Min

Jobless claims edge higher as labor market holds steady

Initial unemployment insurance filings edged lower last week, a further indication that companies are retaining workers.

Jobless claims totaled a seasonally adjusted 227,000 for the week ending May 17, a drop of 2,000 from the prior period and just below the Dow Jones estimate for 230,000, the Labor Department reported Thursday. The four-week moving average nudged higher to 231,500.

Continuing claims, which run a week behind, totaled 1.9 million, up 36,000 from the prior period. The four-week moving average rose to 1.89 million, its highest level since Nov. 27, 2021.

— Jeff Cox

Melius downgrades Marvell Technology, says company's core optics technology could lose relevance by 2030

Melius Research downgraded Marvell Technology to hold on Thursday, anticipating a lack of significant revenue upside in 2025 due to a slower ramp of Amazon's Trainium AI chips produced with Marvell.

"This call just hasn't worked out," Reitzes wrote in a Thursday note to clients. "We are not saying there is a lot of downside in a stock that is down 46% YTD but there is a risk that shares stay rangebound and/or do not perform as well as the bulk of our semis and hardware coverage for the rest of 2025 and 2026."

The analyst acknowledged there is uptical in the company's optical AI business, which comprises roughly 20% of sales), and that the legacy chip businesses saw some rebounding off of tariff news, but said that Marvell's core optics technology—its digital signal processors—could lose relevance at some point later this decade as new players enter the field.

"Given this secular shift, we don't believe investors will pay a significant premium for this part of the AI business since it has a ceiling long-term," he said.

Marvell shares are down about 45% this year.

— Pia Singh

Advance Auto Parts rallies more than 30% after earnings

Shares of the auto parts company surged more than 32% after Advance Auto Parts posted first-quarter results that topped expectations.

Advance Auto Parts reported an adjusted loss of 22 cents per share, narrower than the loss of 82 cents per share expected by analysts polled by LSEG. Revenue of $2.58 billion exceeded the $2.50 billion consensus estimate.

— Sarah Min

Urban Outfitters soars 18% on earnings beat

Shares of Urban Outfitters surged 18% on Thursday morning after the apparel retailer reported quarterly results that were stronger than analysts had expected.

The firm posted earnings of $1.16 per share, exceeding the 84 cents per share consensus, per LSEG. Urban Outfitters' revenue of $1.33 billion was also higher than the forecast $1.29 billion.

The company's earnings beat comes at a time when tariff-induced uncertainty has mired the path forward for other retailers. Shares of Target sank 5% on Wednesday after the company cut its full-year sales outlook.

— Lisa Kailai Han

House advances Trump's tax bill to Senate

The U.S. House of Representatives passed President Donald Trump's "big, beautiful" tax bill early Thursday morning.

The bill passed on a narrow vote and spelled a major victory for Republican leaders. Every Democrat on the floor voted no.

The House Rules Committee convened for 21 straight hours in order to pass the bill by Speaker Mike Johnson's self-imposed Memorial Day deadline. Amendments to the bill, which finally swayed certain Republican factions, included an increase in the so-called SALT deduction cap from a current maximum of $10,000 to $40,000 in allowable deductions for state and local taxes paid.

The bill now advances to the Senate, where it could face similar complications before getting delivered to Trump's desk. Johnson reiterated his deadline of clearing the bill to the Oval Office by July 4.

— Christina Wilkie, Erin Doherty, Lisa Kailai Han

Long-dated Treasury yields nearing resistance, Fundstrat says

Fundstrat technical strategist Mark Newton told clients in a note that longer-dated Treasury yields are approaching resistance levels after breaking out higher this week.

"the breakout to new monthly highs was certainly important for Wednesday's trading and very well could result in another 2-3 days of yields backing up," Newton wrote. "However, it's wrong to think of the trend in yields as being higher on a 2-3 year basis, as both 10-year and 30-year Treasury yields have traded in neutral consolidation patterns since 2023."

"Thus, this becomes an attractive risk-reward opportunity to buy dips in Treasuries with yields pushing higher as the risk/reward has grown more attractive," he added.

— Fred Imbert

Stocks making the biggest moves after hours

Check out the companies making headlines after the bell: 

Lumen Technologies – Shares of the communications company surged 15% after AT&T agreed to acquire substantially all of Lumen's Mass Markets fiber internet connectivity business. 

Snowflake — The cloud-based data storage company's stock surged more than 7% in after-hours trading after the company reported a solid first quarter. 

Urban Outfitters — The apparel retailer saw shares soaring more than 14% in extended trading following a stronger-than-expected quarterly report. 

— Yun Li