Highlights
Mixed but mostly positive quarterly results from big technology bellwethers spurred another rally in equities Thursday along with a pullback in oil prices and bond yields, outweighing rising worries that the US-Iran conflict will be protracted. The Dow Jones industrial average jumped 1.6 percent, the S&P 500 rose 1.0 percent, and the Nasdaq firmed 0.9 percent. Bond yields and oil prices retreated from Wednesday's highs but remained sharply higher on the month. The dollar fell on the day.
The S&P 500 and the Nasdaq both advanced to record closing highs after a mixed but mostly positive batch of earnings from key megacaps as investors focused on AI news from each firm. Alphabet was the day's big winner after positive news on its Google cloud revenues. Meta and Microsoft, on the other hand, came off after investors reacted badly to the magnitude of their AI spending plans. The Dow outperformed, meanwhile, with a boost from upbeat results from Caterpillar.
On a big day for economic reports, GDP matched expectations for Q1, as did personal income and spending. Jobless claims surprised to the downside, suggesting a resilient employment market, in line with weekly ADP employment figures that have been surprisingly strong lately.
Definition
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.
Description
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.