US stocks gain after a back-and-forth session as Wall Street weighs the latest hawkish remarks from Fed Chair Powell

• US stocks ended higher Thursday after a volatile trading session, marking a second straight day of gains.
• Investors weighed more hawkish remarks from Federal Reserve Chairman Jerome Powell.

US stocks ended higher Thursday after a volatile trading session, marking a second straight day of gains, as investors responded to hawkish remarks from Federal Reserve Chair Jerome Powell.

He reiterated the central bank's focus on taming inflation "until the job is done" and predicted "a period of growth below trend."

Markets are gearing up for a 75-basis-point hike at the September 20-21 meeting, with potentially more tightening to follow into 2023. A dovish pivot in the near term now seems less likely as Wall Street sheds some of its optimisim toward a potential ease in tightening.

"The market will continue to struggle until it gets a handle on when the interest rate hike cycle is coming to an end," said Kevin Phillip, partner at Bel Air Investments. "It seems that for the course of 2022 the market and its audience has continually underestimated the resolve of the Fed to rein in inflation."

Here's where US indexes stood as the market closed at 4:30 p.m. on Thursday:

• S&P 500: 4,006.18, up 0.66%

• Dow Jones Industrial Average: 31,774.52, up 0.61% (193.24 points)

• Nasdaq Composite: 11,862.13, up 0.60%

Earlier Thursday, the European Central Bank hiked rates by 75 basis points, the biggest increase in its history, as it tackles persistent inflation amid a worsening energy crisis.

Goldman Sachs raised its forecasts for interest rate increases at the Federal Reserve's next two meetings, and now sees 75 basis points in September and by 50 basis points in November. It previously projected increases of 50 and 25 basis points, respectively.

The central bank is making a mistake with its rate-hike cycle as inflation eases further and potentially turns into deflation, according to Ark Invest's Cathie Wood. She added that the Fed would have to pivot in such a scenario much sooner than the market anticipates.

Elsewhere, China passed the US in corporate debt sales with yuan-denominated bonds surpassing those backed in dollars in recent months, according to data from Bloomberg.

Meanwhile, top economist Mohamed El-Erian thinks US stocks are poised to outperform global peers and navigate market headwinds.

Oil was higher, with West Texas Intermediate climbing 1.83% to $83.43 per barrel. International benchmark Brent crude gained 1.05% to $88.92.

Gold fell 0.56% to $1,708.18 an ounce. The 10-year yield gained 2.5 basis points to 3.29%.

Bitcoin added 0.09% to $19,207.67.