U.S. stocks closed higher on Thursday, as strong corporate earnings helped investors look past weaker-than-expected economic growth data.
The Dow Jones Industrial Average surged 790.33 points, or 1.62%, to 49,652.14. The S&P 500 gained 73.06 points, or 1.02%, to 7,209.01, while the Nasdaq Composite advanced 219.07 points, or 0.89%, to 24,892.31.
Market breadth was broadly positive, with 10 of the 11 major sectors in the S&P 500 finishing in the green. Communication services and industrials led gains, rising 3.98% and 2.76%, respectively. However, the technology sector underperformed, declining 0.63%.
On the economic front, the U.S. Department of Commerce reported that the U.S. economy grew at an annualized rate of 2% in the first quarter. Although this marked an improvement from the previous quarter’s 0.5% growth, it fell short of analysts’ expectations of 2.2%.
At the same time, rising gasoline prices pushed the Federal Reserve’s preferred inflation gauge to 3.5% in March, the highest level in nearly three years, adding to concerns about persistent inflationary pressures.
Despite the softer macroeconomic data, upbeat corporate earnings drove market momentum. Shares of Caterpillar Inc. jumped nearly 10% after the company reported better-than-expected quarterly results and raised its full-year revenue outlook, providing a strong boost to the Dow.
Investor focus also centered on earnings from major technology firms. Following the previous session’s close, Alphabet Inc., Amazon, Meta Platforms, and Microsoft released quarterly results, triggering mixed reactions in Thursday’s trading.
Alphabet shares surged nearly 10%, while Meta Platforms and Microsoft declined 8.55% and 3.93%, respectively. Amazon managed to close slightly higher after fluctuating during the session. Meanwhile, AI chipmaker Nvidia dropped 4.63%.
Among other notable movers, Qualcomm soared 15.12%, leading gains on both the S&P 500 and Nasdaq after reporting strong earnings and announcing new custom silicon offerings for a major hyperscaler.
Overall, the session reflected investor optimism driven by strong earnings, even as concerns over economic growth and inflation remain in focus.