NEW YORK (AP) — U.S. stocks rallied Thursday in Wall Street’s latest sharp swerve after a better-than-expected report on unemployment eased worries about the slowing economy .

The S&P 500 jumped 2.3% for its best day since 2022 and shaved off all but 0.5% of its loss from what was a brutal start to the week. The Dow Jones Industrial Average rose 683 points, or 1.8%, and the Nasdaq composite climbed 2.9% as Nvidia and other Big Tech stocks helped lead the way.

Treasury yields also climbed in the bond market in a signal investors are feeling less worried about the economy after a report showed fewer U.S. workers applied for unemployment benefits last week. The number was better than economists expected.

It was exactly a week ago that worse-than-expected data on unemployment claims helped enflame worries that the Federal Reserve has kept interest rates at too high of an economy-slowing level for too long in order to beat inflation . That helped send markets reeling , along with a rate hike by the Bank of Japan that sent shockwaves worldwide by scrambling a favorite trade among some hedge funds.

At the worst of it, at least so far, the S&P 500 was down nearly 10% from its all-time high set last month. Such drops are regular occurrences on Wall Street, and “corrections” of 10% happen roughly every year or two. After Thursday's jump, the index is back within about 6% of its record.

What made this decline particularly scary was how quickly it happened. A measure of how much investors are paying to protect themselves from future drops for the S&P 500 briefly surged toward its highest level since the COVID crash of 2020.

Still, the market’s swings look more like a “positioning-driven crash” caused by too many investors piling into similar trades and then exiting them together, rather than the start of a long-term downward market caused by a recession, according to strategists at BNP Paribas.

They say it looks more similar to the “flash crash” of 2010 than the 2008 global financial crisis or the 2020 recession caused by the pandemic.

Of course, markets have been quick to turn over the past week regardless of any long-term predictions.

“Today’s jobless claims data may ease some of the concerns raised by last week’s soft jobs report,” said Chris Larkin, managing director, trading and investing, at E-Trade from Morgan Stanley. “But with inflation data due out next week and the stock market still working through its biggest pullback of the year, it’s unclear how much this will move the sentiment needle.”

In the meantime, big U.S. companies continue to turn in profit reports for the spring that are mostly better than analysts expected.

Eli Lilly jumped 9.5% to help lead the market after it delivered stronger profit and revenue than Wall Street had forecast. Sales of its Mounjaro diabetes treatment and its Zepbound weight-loss counterpart are booming, and the company raised its financial forecast for the year.

Big Tech stocks also rose to claw back some of their sharp losses from the last month.

After a handful of them almost singlehandedly drove the S&P 500 to dozens of all-time highs this year, the group known as the “Magnificent Seven” lost momentum last month amid criticism their prices soared too high in investors’ frenzy around artificial-intelligence technology.

How this handful of stocks performs carries extra impact on the S&P 500 and other indexes because they’re by far the market’s most valuable companies. Nvidia , which has become the poster child for the AI trade, rose 6.1% to trim its loss for the week so far to 2.1%, and it was the day’s strongest single force pushing upward on the S&P 500.

Gains of 1.7% for Apple and 4.2% for Meta Platforms were also big propellants, along with Eli Lilly.

They helped offset a drop of 11.3% for McKesson, which topped analysts’ expectations for profit in the latest quarter but fell short on revenue. It said growth slowed in its medical-surgical business.

Bumble, the Texas-based dating app, lost more than a quarter of its value, 29.2%, after its forecast for revenue in the third quarter came in well below Wall Street’s.

All told, the S&P 500 rallied 119.81 points to 5,319.31. The Dow gained 683.04 to 39,446.49, and the Nasdaq composite rose 464.22 to 16,660.02.

In the bond market, the yield on the 10-year Treasury rose to 3.99% from 3.95% late Wednesday.

In stock markets abroad, indexes were mixed across Asia and Europe. In Japan, which has been home to some of the wildest moves in global markets, the Nikkei 225 ticked down by 0.7%. That looked like a ripple following its tidal swings of down 12.4% and up 10.2% to start the week.

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AP Business Writers Yuri Kageyama and Matt Ott contributed.