NEW YORK: Wall Street’s main indexes jumped on Thursday, as investors welcomed a handful of positive corporate earnings and signs that the US was open to de-escalating its trade war with China.
Software firm ServiceNow and toymaker Hasbro topped the S&P 500, rising 14.8% and 15.7%, respectively, after both companies reported better-than-expected quarterly results.
ServiceNow lifted the information technology sector 2.7%, while megacap stocks further added to tech gains.
About 73.9% of the 157 companies in the S&P 500 that have reported first-quarter earnings to date have exceeded analyst expectations even amid tariff uncertainty, as per data compiled by LSEG.
Markets are also reacting to US Treasury Secretary Scott Bessent’s comments that the current levies the world’s two largest economies have slapped on each others’ goods were “unsustainable”, a day after reports said the White House was considering slashing Beijing tariffs.
“Recent developments suggest a less aggressive approach to resolving trade disputes,” said Ulrike Hoffmann-Burchardi, chief investment Officer of global equities, UBS Global Wealth Management.
“The market’s strong rebound reflects growing confidence that the most adverse outcome can be avoided, though upcoming news flow will likely continue to drive short-term swings.”
Economic data also helped lift some sentiment, with reports showing only a moderate rise in weekly jobless claims and a much larger-than-expected jump in March orders for durable goods.
At 11:54 a.m. ET, the Dow Jones Industrial Average rose 310.48 points, or 0.78%, to 39,917.56, the S&P 500 gained 78.96 points, or 1.47%, to 5,454.82 and the Nasdaq Composite gained 338.19 points, or 2.02%, to 17,046.06.
Though markets have cheered signs of a softer trade stance, plenty of uncertainty remains, with Bessent saying a move to reduce levies would not come unilaterally, and China responding that the US should lift all unilateral tariff measures if it “truly” wants to solve the trade issue.
A deluge of changing headlines and the lack of clarity in the market are making it difficult for investors to assess the impact of Trump’s changing stance on trade policy, creating a volatile environment.
All three major indexes are in the red year-to-date and the S&P 500 is down over 11% from its February record close. Deutsche Bank slashed its year-end target for the benchmark index to 6,150 from 7,000 previously.
Numerous companies have flagged the impact of tariffs on their outlook as well.
Proctor & Gamble fell 5.2% after cutting its annual profit forecast, while Alaska Airlines slumped 9.8% after it, along with several other airlines, withdrew financial forecasts.
Alphabet rose 1.8% ahead of its results, expected after markets close.
Advancing issues outnumbered decliners by a 4.59-to-1 ratio on the NYSE and by a 2.48-to-1 ratio on the Nasdaq.
The S&P 500 posted 3 new 52-week highs and 4 new lows, while the Nasdaq Composite recorded 29 new highs and 40 new lows.
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