Market Volatility Rises Following GDP Data; S&P 500 Settles Higher

The S&P 500 settled higher on Thursday as bank stocks rallied following the Fed's stress test results, which showed all 23 banks tested remained above their minimum capital requirements during a hypothetical recession.

The U.S. economy expanded by an annualized rate of 2% on quarter in the first quarter, higher than the 1.3% growth in the second estimate, and market expectations of 1.4%.

Traders are seeing around 87% chance that the Federal Reserve will raise interest rates by 25 basis points at its July meeting.

Investors are awaiting the release of Fed's preferred inflation gauge, the Personal Consumption Expenditure index for May, which is scheduled for release on Friday.

NIKE, Inc. NKE reported downbeat earnings for its fourth quarter, while sales topped estimates.

Majority of sectors on the S&P 500 closed on a positive note, with financial and materials stocks recording the biggest gains on Thursday. However, consumer staples and communication services stocks closed lower during the session.

The Nasdaq 100 fell 0.16% to close at 14,939.95 on Thursday, amid losses in shares of NVIDIA Corp NVDA and Amazon.com, Inc. AMZN.

The S&P 500 rose 0.45%, while the Dow Jones gained 0.80% to 34,122.42 in the previous session.

The Chicago Board Options Exchange's CBOE Volatility Index (VIX) rose 0.8% to close at 13.54 on Thursday.

What is CBOE Volatility Index?

The CBOE Volatility Index, popularly known as VIX, is a measure of the equity market's expectation of volatility based on S&P 500 index call and put options.

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