US stocks jump after oil prices fall and pressure from the bond market eases

NEW YORK (AP) — U.S. stocks are jumping Thursday and clawing back most of their losses for the week.

Falling oil prices and easing pressure from the bond market are helping Wall Street reverse many of its moves from the prior day, when the Federal Reserve hiked its main interest rate for the first time in years and suggested more may be ahead as it tries to get the nation’s high inflation under control.

The S&P 500 jumped 1% and was on track for just its second rise in the last nine days. The Dow Jones Industrial Average was up 306 points, or 0.6%, as of 9:35 a.m. Eastern time, and the Nasdaq composite was 1.3% higher.

Stocks got a boost after the price for a barrel of Brent crude oil slid 3% to $102.70. That’s down sharply from the nearly $110 it reached earlier in the week on worries that the war with Iran will keep oil bottled up in the Middle East instead of going to customers worldwide.

Brent is of course still much more expensive than the $72 per barrel that it cost earlier this summer, but Thursday’s slide helped pull yields lower in the bond market and removed some pressure on stocks. The yield on the 10-year Treasury fell to 4.95% from 5.01% late Wednesday.

Higher yields make it more expensive for everyone to borrow money, from the U.S. government to people looking to buy houses to businesses wanting to build data centers. That in turn slows the economy.

The Fed on Wednesday raised the short-term interest rate that it controls, the federal funds rate, by a quarter of a percentage point for its first hike in more than three years. Officials also indicated at least one more increase may be coming this year and that the Fed may then keep the federal funds rate high through next year.

The signals sent Wall Street on a roller coaster. Stocks initially held onto their earlier gains Wednesday but then slid sharply before recovering a chunk of the losses before trading ended for the day.

On the upside for markets, the shift to higher interest rates built confidence that the Fed is committed to getting inflation back to its target of 2%. Questions had begun to bubble in the summer about whether the Fed would feel pressure from President Donald Trump, who has been calling for lower interest rates. And the short-term cost of pain for the economy could be worth it if it gets inflation under control following years of staying too high.

On the downside for markets, higher rates would undercut prices for stocks and other investments. When investors are making more in interest from owning bonds, which are considered safer investments, they’re less willing to pay high prices for other kinds of investments. That’s beyond the effect higher rates have in slowing the economy in hopes of removing fuel for further acceleration of inflation.

Some reports on Thursday signaled the U.S. economy may be strong enough to withstand higher interest rates. One said fewer U.S. workers applied for unemployment benefits last week, the latest sign that the job market remains solid. Another said that manufacturing growth in the mid-Atlantic region was stronger than economists expected.

Fed Chairman Kevin Warsh said on Wednesday that a strengthening economy is one of the reasons Fed officials moved to raise interest rates after keeping them on hold through this year.

He also cited “geopolitics,” along with the threat that the increases in prices it’s causing could push up inflation elsewhere. That’s likely a nod to the war with Iran and its effect on oil prices.

On Wall Street, stocks in the artificial-intelligence industry continued to rebound following their worldwide slide on Monday after leaders of the AI industry called for a slowdown in development to address safety issues for humanity.

Nvidia climbed 1.8%, and Advanced Micro Devices rose 3.6%. That was even though OpenAI disclosed six more reports of “unexpected or concerning” behavior in AI models.

Stocks of several homebuilders also rose, even though a report showed the industry broke ground on fewer new homes last month than economists expected. The housing industry has been one of the hardest hit by the climb for the 10-year Treasury’s yield, which topped 5% this week for the first time since 2023 and has sent mortgage rates higher.

Thursday’s ease in yields helped offer some support, and D.R. Horton rose 0.8%, while PulteGroup added 0.6%. Rival Lennar fell 0.9% after reporting weaker profit and revenue for the latest quarter than analysts expected.

In stock markets abroad, indexes rose across much of Europe following a weaker finish in Asia.

London’s FTSE 100 rose 0.8% after the Bank of England decided to keep its interest rates on hold.

AP Business Writers Chan Ho-him and Michelle Chapman contributed to this report.

Traders work on the floor at the New York Stock Exchange in New York, Wednesday, Sept. 16, 2026. (AP Photo/Seth Wenig)

Screens display a news conference held by Federal Reserve chairman Kevin Warsh on the floor of the New York Stock Exchange in New York, Wednesday, Sept. 16, 2026. (AP Photo/Seth Wenig)

Screens display financial information on the floor at the New York Stock Exchange in New York, Wednesday, Sept. 16, 2026. (AP Photo/Seth Wenig)

Currency traders work at the foreign exchange dealing room of the Hana Bank headquarters in Seoul, South Korea, Thursday, Sept. 17, 2026. (AP Photo/Ahn Young-joon)

Currency traders watch monitors near a screen showing the Korea Composite Stock Price Index (KOSPI) at the foreign exchange dealing room of the Hana Bank headquarters in Seoul, South Korea, Thursday, Sept. 17, 2026. (AP Photo/Ahn Young-joon)

Currency traders pass by a screen showing the Korea Composite Stock Price Index (KOSPI) at the foreign exchange dealing room of the Hana Bank headquarters in Seoul, South Korea, Thursday, Sept. 17, 2026. (AP Photo/Ahn Young-joon)

WASHINGTON (AP) — The unprecedented spate of mid-decade redistricting for the U.S. House has changed the congressional districts for one-tenth of Americans and significantly altered the makeup of at least one-fifth of districts, according to a new study.

A report by Protect Democracy found that 34.8 million people — about one in 10 Americans — now live in a different district than they did during the 2024 election cycle. And about one-fifth of all Americans now live in a district where more than a quarter of voters are new to the district compared with the last election cycle.

The findings display the stark overhaul that partisan redistricting fights kicked off by President Donald Trump last year have caused for Americans across the country. The new congressional maps are increasingly drawn in ways that favor partisan politics over factors like geography and shared communities. That raises concerns among scholars about how the country's hyperpolarized politics are affecting American democracy.

“If this trend continues, it really brings into question whether or not elected officials are really representing their constituents anymore, or if the voters are being randomly picked by mapmakers to squeeze out partisan advantage," said Ben Raderstorf, a policy advocate at Protect Democracy and one of the paper’s co-authors.

The bare-knuckled partisan redistricting battle for the House began when Trump urged the Republican-controlled legislature in Texas, the second most populous state, to redraw its congressional map to help the party. The highly unusual plan prompted an immediate response from California, the most populous state, which held a successful referendum to tilt its map toward Democrats.

Other states followed, and Republicans are positioned to potentially gain nine seats because of redistricting.

The Protect Democracy report warns that such partisan tactics reduce faith in American elections generally and insulate incumbent lawmakers from public opinion. That can make political organizing more difficult, the report cautioned, potentially worsening the country's already highly polarized politics. Both parties may also enter a “doom loop” where they embrace more aggressive and frequent redistricting efforts to avoid ceding any ground to their rivals.

In some states such as Missouri, the mid-decade redistricting has created confusion for voters about which district they live in and which candidates will appear on their November ballot. After conflicting lower court rulings, the U.S. Supreme Court last week blocked new Missouri districts backed by Trump that had been used in the primary, leaving the state to revert to its previous districts for the general election.

The report concludes with a call for new electoral structures the authors believe would eliminate the potential downsides of partisan redistricting, like proportional representation or a formal truce between the parties to implement nonpartisan districting plans.

Nine states already use nonpartisan commissions to draw congressional district lines but those provisions have limits. California, for instance, suspended its nonpartisan maps with a referendum last year in response to Texas' redistricting measures.

Such remedies would face long odds in Congress and statehouses, but scholars believe there are few other avenues to turn down the temperature in the partisan redistricting fights.

“This is only going to get worse until somebody stops it,” Raderstorf said. “The logic of gerrymandering points inevitably towards maximalist partisan advantage on both sides. There is no off-ramp other than reform. It is the only way to break the cycle.”

This photo taken with a smartphone shows Steve Perry, of Kansas City, holding a sign in opposition to Missouri’s congressional redistricting plan on Wednesday, Sept. 2, 2026, outside the state Capitol, in Jefferson City, Mo. (AP Photo/David A. Lieb)