Stocks recovered Thursday after two days of losses with a boost from chipmakers and bank stocks. The Dow Jones industrial average rose 0.6 percent while the S&P 500 and the Nasdaq both gained 0.3 percent. US Treasury yields and the dollar gained while oil prices dropped.

Upbeat quarterly results from TSMC, the big chipmaker, lifted the sector and gave new momentum to the AI trade. Bank stocks were another big winner after positive quarters from Goldman Sachs and Morgan Stanley.

Bond yields were lifted by unexpectedly positive economic reports including a surprisingly low jobless claim number and surprisingly positive regional manufacturing reports from the Philadelphia Fed and the New York Fed pointing to a stronger start to 2026.

Market Reflections track market reaction to the trading day's major events. Economic data, policymaker speeches, and company news are featured in this report as well as key indexes and financial instruments.

Understanding why markets respond as they do is fundamental for an investor. Market Reflections help explain how the day's events, news, and data impact the outlook for the economy and for market prices.