The stock market saw a positive trend on Thursday, with major indexes closing higher. The S&P 500 Index, Dow Jones Industrials Index, and Nasdaq 100 Index all posted gains. Chip makers led the rally after Taiwan Semiconductor Manufacturing Co (TSMC) reported stronger-than-expected Q1 sales and increased its capital expenditure forecast for 2026. This news boosted confidence in the sustainability of artificial intelligence demand.
Additionally, economic data released on Thursday showed signs of strength in the US economy. Weekly jobless claims fell to a 6-week low, and both the Jan Empire and Jan Philadelphia Fed business outlook surveys exceeded expectations. These positive indicators supported the upward movement in stocks.
Geopolitical tensions eased slightly as President Trump stated that Iran had assured him they would stop killing protesters, potentially avoiding a military response from the US. This development contributed to a drop in WTI crude oil prices.
However, stocks retreated from their highs as hawkish comments from Federal Reserve officials pushed bond yields higher. The 10-year T-note yield rose, reflecting expectations for continued inflation pressures.
In terms of individual stock movements, chip makers like KLA Corp, Applied Materials, and ASML Holding NV saw significant gains following TSMC’s optimistic forecast. Conversely, energy producers and service providers, as well as cryptocurrency-exposed stocks, experienced losses.
Looking ahead, the focus will be on economic news and updates from the Federal Reserve. Q4 earnings season is also set to begin, with S&P earnings expected to grow. The odds of a rate cut at the FOMC’s next meeting are currently low.
Overseas markets showed mixed results, with the Euro Stoxx 50 closing higher while China’s Shanghai Composite and Japan’s Nikkei Stock 225 closed lower.
In the interest rate market, T-notes and European government bond yields rose, reflecting the positive sentiment in the stock market. Eurozone and UK economic data also exceeded expectations.
Overall, the stock market’s performance was driven by positive economic indicators, corporate earnings forecasts, and geopolitical developments. Investors will continue to monitor these factors as they navigate the market in the coming days.
