A week after a quiet trading session, the U.S. stock market jumped on Thursday as investors digested a surprisingly mild inflation report and a strong earnings announcement from Micron Technology. The S&P 500 climbed 0.8%, the Dow Jones Industrial Average added 65 points, and the Nasdaq composite surged 313 points, marking a sharp reversal of the tech-heavy decline that had been seen earlier in the week.
Inflation data eases Fed concerns
The U.S. Bureau of Labor Statistics released a report showing that inflation rose 2.7% in March, a figure that sits just above the Federal Reserve’s 2% target. While the number is still higher than many investors would like, it is lower than economists had expected for the month. The report suggests that the Fed may have more flexibility to cut rates next year if inflation continues to move toward the target.
Some analysts noted that the inflation update might not immediately alter the Fed’s policy stance because economic data have been noisy since the government shutdown. However, the better-than-expected numbers are still a positive signal for a market that is sensitive to any hint of easing monetary policy.
Micron Technology’s earnings lift AI stocks
Micron Technology, a maker of memory and storage chips, posted quarterly results that beat analysts’ expectations for both revenue and profit. The company’s shares jumped 10.2% after the announcement. CEO Sanjay Mehrotra said each of the company’s business units enjoyed stronger revenue and made more in profit off each $1 of that revenue. He also highlighted the firm’s role as an “AI enabler” and noted that its forecasts for the next quarter surpassed analyst predictions.
The earnings beat helped calm concerns that the rapid rise in AI-related stock prices might have been over-valued. Micron’s performance, along with the continued influx of billions of dollars into AI technology, keeps the narrative that AI will drive future growth alive for many investors.
Other tech and non-tech performers
- Oracle added 0.9% after reporting better-than-expected quarterly profits, despite a recent sharp decline in its share price.
- Broadcom rose 1.1% on similar earnings news.
- Nvidia climbed 1.8% as the chipmaker’s dominant position in the AI market remains a key driver of its stock.
- Trump Media & Technology Group surged 41.9%, trimming a large loss for the year and moving closer to a 69.3% gain for the trading day. The company is merging with TAE Technologies in an all-stock deal that will combine Trump Media’s capital-raising ability with TAE’s nuclear-fusion reactor technology.
- Cintas increased 1.3% after reporting stronger quarterly profit and announcing a program that could send up to $1 billion to shareholders through a share-buyback.
- Darden Restaurants climbed 1.8% even though its quarterly profit fell short of expectations. Revenue growth outpaced forecasts, helped by new restaurant openings and higher sales at existing locations.
- CarMax fell 4.2% after reporting a stronger quarterly profit. The auto retailer said it may make less profit from each $1 of revenue in used-auto sales and plans to increase marketing spend to attract more customers.
Global market reactions
International equity markets mirrored the U.S. rally. London’s FTSE 100 rose 0.6%, the French CAC 40 gained 0.8%, and Germany’s DAX climbed 1% after the Bank of England cut its key interest rate while the European Central Bank kept rates unchanged. Asian markets were mixed: South Korea’s KOSPI fell 1.5%, whereas Shanghai’s SSE Composite added 0.2%.
Bond market response
The Treasury market reacted to the softer inflation data. The yield on the 10-year Treasury fell to 4.11% from 4.16% late on Wednesday, reflecting a shift toward lower rates amid the new economic information.
Key Takeaways
- U.S. stocks jumped on Thursday, with the S&P 500 up 0.8% and the Nasdaq leading at 1.4%.
- Inflation rose 2.7% in March, below expectations and closer to the Fed’s 2% target.
- Micron Technology’s 10.2% share jump followed earnings that beat forecasts and highlighted its role as an AI enabler.
- Several tech giants, including Oracle, Broadcom, and Nvidia, posted gains after better-than-expected quarterly results.
- Global markets moved higher, and Treasury yields slipped in response to the inflation report.
The day’s events underscore how a single data release and a strong earnings announcement can quickly shift market sentiment, especially when investors are watching for clues about future monetary policy and the continued rise of AI technology.
