Wall Street Jumps on Tech Boost, Yen Slides on BOJ Gloom

  • Wall Street stocks rallied, and gold prices slid on Thursday as solid earnings from big tech bolstered investor risk appetite. All three major U.S. stock indexes began the month in positive territory, with upbeat quarterly results from Meta Platforms and Microsoft, benefiting the Nasdaq most, sending the tech-laden index up 2.3%.
  • "Clearly sparking (Thursday's) rally was better-than-expected earnings from Microsoft and Meta, and once again calming some of the over-the-top recessionary worries that we were dealing with just a couple of weeks ago," said Ryan Detrick, chief market strategist at Carson Group in Omaha. "But the good news is stocks have now recovered from the selloff after 'Liberation Day.'"
  • U.S. President Donald Trump announced steep tariffs on April 2, which rattled world markets for much of last month. The dollar advanced as the yen took a hit after the Bank of Japan cut its growth forecasts due to uncertainties surrounding U.S. tariff policy. Trading was thin throughout Asia and Europe due to May Day holidays. There were no major announcements regarding trade negotiations following Trump's April 2 announcement.
  • First quarter earnings season is well past its halfway point, with 325 companies in the S&P 500 having reported. Of those, 74% have beaten analyst expectations, according to LSEG. Apple and Amazon are due to report after the closing bell, the fifth and sixth members of the so-called "magnificent seven" to post quarterly results, leaving chipmaker Nvidia, which is expected to release its first-quarter earnings on May 28.
  • "The reality is the economy is slowing but not dropping off a cliff, and some of these large tech companies are confirming that," Detrick added. "It's nice to talk about something besides tariffs, especially when it's backed by some solid earnings overall by some of the large tech companies." On the economic front, U.S. factory activity remained in contraction, while jobless claims increased more than analysts expected.

(Source: Reuters)