U.S. stocks experienced a notable rise on Thursday, marking the eighth consecutive day of gains for both the Dow Jones and S&P 500 indexes. This upward trend was fueled by impressive earnings reports from tech giants Microsoft and Meta Platforms, which alleviated fears surrounding artificial intelligence investments. Investors seemed relieved as these results shifted the focus from concerns over trade policies back to economic performance.

Strong Earnings from Tech Giants

Microsoft’s stock surged to its highest point since late January, driven by an optimistic outlook for its cloud-computing service, Azure. The company’s strong quarterly growth projection allowed it to briefly overtake Apple as the most valuable company globally. Meanwhile, Meta Platforms also saw a significant rise, reaching a five-week high after reporting revenues that exceeded expectations, primarily due to robust advertising performance.

• Microsoft’s Highlights:

  • Upbeat quarterly outlook for Azure.
  • Briefly surpassed Apple in market value.
• Meta’s Success:
  • Revenue exceeded expectations.
  • Strong advertising performance boosted results.

Market Reactions and Economic Data

According to preliminary figures, the S&P 500 climbed by 33.25 points (0.60%) to close at 5,602.31, while the Nasdaq Composite rose by 254.04 points (1.46%) to finish at 17,700.38. The Dow Jones Industrial Average gained 70.05 points (0.17%), ending at 40,739.41. This marked the longest win streak for the Dow in a year and for the S&P since August, signaling a robust earnings season.

Portfolio Manager Lamar Villere expressed optimism, noting, "It’s refreshing to see the market driven by earnings instead of trade concerns. Companies like Microsoft and Meta are proving that their growth stories are far from over."

Concerns and Mixed Economic Signals

Despite the positive earnings, the market remains cautious due to ongoing shifts in U.S. trade policy, which have led several companies to revise their profit forecasts downward. As per LSEG data, first-quarter earnings for the S&P 500 are projected to grow by 12.9% year-over-year, an uptick from the 8% growth rate anticipated earlier in April.

In contrast, economic data released revealed a mixed landscape. Weekly jobless claims surpassed expectations, indicating a potential rise in layoffs amid trade tensions. Additionally, the ISM PMI data showed a further contraction in U.S. manufacturing during April, albeit slightly better than economists had forecasted.

Challenges for Other Major Companies

Eli Lilly reported quarterly results that exceeded analyst expectations. However, its shares plummeted after CVS Health announced it would remove Lilly’s obesity drug, Zepbound, from some reimbursement lists, contributing to a downturn in the healthcare sector.

Similarly, McDonald’s faced a setback as its shares dipped following an unexpected decline in first-quarter global sales. Furthermore, mobile chipmaker Qualcomm experienced a drop in its stock price after forecasting revenue impacts due to ongoing trade disputes.

In summary, while the U.S. stock market shows resilience with notable gains from key players like Microsoft and Meta, underlying economic signals and challenges for other companies hint at a complex financial landscape ahead. As investors await earnings reports from other major firms such as Amazon and Apple, the market remains vigilant in navigating through these uncertainties.