Stocks rose Thursday morning as investors reacted to a barrage of earnings reports from major companies and important economic indicators.
The S&P 500 and Nasdaq Composite were each up 0.6% about half an hour after the opening bell, while the Dow Jones Industrial Average tacked on 0.3%. Stocks closed lower on Wednesday after the Federal Reserve decided to leave its benchmark interest rate unchanged and said it’s not in a rush to adjust policy as inflation remains elevated.
It’s been a rollercoaster week for the U.S. stock market as investors have been forced to reevaluate some of their thinking about investments tied to AI, after Chinese startup DeepSeek launched a high-performing AI model that was developed at a fraction of the cost that U.S. companies are spending. The DeepSeek news has placed an even brighter spotlight than usual on Big Tech earnings this week.
Shares of Meta Platforms (META) were up more than 4% early Thursday after the company late yesterday reported better-than-expected results as its spending on AI grows significantly. Microsoft (MSFT) was down more than 4% despite reporting results that topped analysts’ expectations on the top and bottom line, as revenue in its Intelligent Cloud segment came in light. IBM (IBM) shares were up 12% after the company showed a big increase in its generative AI business in the fourth quarter.
Tesla (TSLA) shares were up about 1% as the EV maker’s ambitious plans for self-driving vehicles and expectation that vehicle sales will grow in 2025 offset fourth-quarter results that fell short of Wall Street estimates.
Other large-cap technology stocks were mixed. AI investor favorite Nvidia (NVDA) and Amazon (AMZN) were slightly lower, while Apple (AAPL) and Alphabet (GOOGL) gained ground. Apple is due to report quarterly results after today’s closing bell.
Among other noteworthy post-earnings report movers, parcel delivery giant United Parcel Service (UPS) was down 15%, health insurer Cigna (CI) fell 10% and heavy machinery maker Caterpillar (CAT) dropped 5%.
On the economic data front this morning, the first reading on fourth-quarter U.S. economic growth came in slightly below expectations, as did weekly jobless claims figures, though the numbers continue to show the strength of the economy. The Fed, following its decision Wednesday to hold its influential fed funds rate steady, that the labor market is on sound footing while inflation remains “somewhat elevated.”
The yield on the 10-year Treasury, which is sensitive to expectations about where interest rates are headed, was at 4.52% in recent trading, down from 4.56% at yesterday’s close.
Bitcoin was at $106,000, up from from an earlier low of $103,300, while gold futures rose more than 1% to around $2,830 an ounce and WTI crude oil futures advanced 0.5%.