Retail sales in July came in above expectations, the government reported on Thursday, painting an optimistic picture of consumer spending that could ease concerns about the strength of the economy.

The better-than-expected results, pointing to continued economic sturdiness, drove stocks higher. The S&P 500 jumped 1 percent in early trading, as did the tech-heavy Nasdaq composite.

Retail sales rose 1 percent in July from the previous month, the Commerce Department said, well above the 0.4 percent increase that economists were expecting. A bounce-back in auto sales as cyberattack-related disruptions faded probably intensified the jump in overall retail sales, analysts said. But sales excluding autos and gasoline, a calculation that can be more indicative of spending trends, also beat expectations, rising 0.4 percent.

Consumer spending is a key driver of the U.S. economy, accounting for roughly two-thirds of gross domestic product. The strong retail sales report, which is not adjusted for inflation, pointed to resilience in consumer spending and provided reassurance after recession fears, tied to weaker-than-expected employment numbers, catalyzed a market sell-off early this month. It’s the latest in a string of data points this week that allay those worries.

Walmart reported on Thursday that sales in the latest quarter rose higher than analysts’ estimates. The retailer’s shares were up more than 7 percent on Thursday in early trading, a big move for a company of its size.

Another reassuring data point on Thursday: Unemployment claims for the week ended Aug. 10 fell from the week before, indicating resiliency in the job market.

Overall inflation was 2.9 percent in July on a yearly basis, the Bureau of Labor Statistics reported on Wednesday, marking the first time inflation has dropped below 3 percent since 2021. Cooling inflation has reassured investors that the Federal Reserve is likely to start lowering interest rates next month.

“More data like this could ease concerns that the economy is tilting toward recession, and take pressure off the Fed to cut rates more aggressively than they’d like to,” said Chris Larkin, head of trading and investing at E-Trade.