The United States stock market, Wall Street, recorded a significant recovery at the close of Thursday's trading local time. This rally managed to erase most of the previous day's losses, driven by the stellar performance of the information technology sector, which surged 5.1 percent and became the main driver of the overall index movement.
All three major Wall Street benchmark indexes ended in the green. The Nasdaq Composite index led the gains by jumping 2.78 percent to the 25,122.18 level. Meanwhile, the S&P 500 index appreciated 1.66 percent to 7,437.63, and the Dow Jones Industrial Average rose 1.19 percent or gained 613.92 points to end at 52,208.06.
The market's revival this time was supported by the release of earnings reports from giant tech issuers that exceeded expectations. This positive performance eased investor concerns regarding the effectiveness of massive investments in the field of artificial intelligence (AI). In addition, the stock market also experienced a technical recovery after being under pressure following the US central bank, the Federal Reserve's, decision to keep benchmark interest rates unchanged the previous day.
Positive market sentiment was also bolstered by the release of US macroeconomic data. June's Core Personal Consumption Expenditures (Core PCE) inflation slowed to 0.1 percent on a monthly basis or 3.3 percent on an annual basis. This cooling inflation figure, combined with second-quarter economic growth (GDP) slowing to 1.5 percent from an initial estimate of 1.8 percent, reinforced market participants' expectations for monetary policy easing in the near future.
Microsoft became the main star with a stock surge of more than 15 percent, adding up to 450 billion US dollars to its market capitalization in a single day—the largest daily gain record in Wall Street history. This fantastic jump was triggered by growth in its Azure cloud computing business, which beat market estimates. The semiconductor sector also recovered, with the PHLX Semiconductor Index rising 8 percent, supported by Micron Technology, which grew 8.4 percent, and Advanced Micro Devices (AMD), which rose 7.3 percent.
Conversely, Meta Platforms shares plummeted about 9 percent due to a decrease in free cash flow and increased capital expenditure projections for AI investment. This performance divergence shows that investors are now being more selective in assessing the monetization of AI technology in each company. Going forward, market participants are projected to focus on the continuation of other major corporate earnings reports as well as the release of the Non-Farm Payrolls employment data at the end of the week.
