The US stock market extended its rally for a third consecutive day on Thursday, buoyed by easing trade tensions and dovish remarks from Federal Reserve officials. The Dow Jones Industrial Average climbed nearly 500 points, a gain of 1.2%, while the S&P 500 increased by 2%. The tech-heavy Nasdaq Composite rose approximately 2.7%.
The surge in stock values followed news that China may pause its 125% tariff on some US goods, bolstering positive market sentiment. Additionally, Federal Reserve Bank of Cleveland President Beth Hammack suggested that an interest rate cut could be on the table for June if forthcoming economic data is clear and convincing. Alphabet Inc., Google’s parent company, announced impressive fiscal first-quarter financial results that surpassed expectations for both revenue and earnings per share.
The company reported earnings per share of $2.81 on revenue of $90.2 billion, along with plans to boost its dividend by 5% and authorized a $70 billion stock buyback. This news propelled Google’s stock price by more than 3%. In contrast, Intel reported mixed news as it surpassed first quarter earnings expectations but provided a disappointing forecast for Q2.
Intel projected second-quarter revenue between $11.2 billion and $12.4 billion, falling short of Wall Street’s expectations of $12.8 billion.
Easing trade tensions lift stocks
This outlook led to a 6% drop in Intel’s stock during after-hours trading.
Wall Street’s optimistic outlook was further dampened by a new report from Goldman Sachs, which revised its first quarter GDP forecast downward. The investment bank now expects the US economy to have contracted by 0.2% in the first quarter, pointing to a sharper-than-expected decline in existing home sales and slower growth in durable goods inventories. Despite these mixed signals, the broader market maintained a strong performance.
Investors continued to digest positive trade developments and adapt to shifting economic forecasts. The market sentiment remained buoyant, reflecting the complex interplay of global trade negotiations and domestic economic policies. In other news, Bitcoin saw significant interest as its price surged over 6% in the past month to $93,000 per coin.
Cantor Equity Partners’ stock rose more than 63% following the announcement of a merger with Twenty One Capital, aimed at offering specialized Bitcoin investment vehicles. As market conditions evolve, investors remain cautious yet hopeful that recent gains can be sustained. The coming weeks will be critical in determining whether the positive momentum can continue amidst ongoing trade negotiations and central bank policies.