Stocks looked set to soar on Thursday after blowout earnings from two blue-chip Big Tech companies put investors in a cheery mood, even after the Federal Reserve held interest rates steady.
Futures tracking the Dow Jones Industrial Average were up 130 points, or 0.3%. S&P 500 futures added 0.9% and contracts tied to the Nasdaq 100 jumped 1.3%, putting the tech-heavy index on course for yet another record.
The gains came after IT giant Microsoft and Facebook parent Meta Platforms topped Wall Street’s lofty earnings expectations, with both companies flagging artificial intelligence as one driver of profit growth. The results ought to win over any investors who weren’t already all-in on the AI trade.
“Meta and Microsoft turned over a new chapter in the AI story last night,” Hargreaves Lansdown analyst Matt Britzman said. “Both companies crushed it, with debates around whether AI is delivering tangible returns starting to fade into history. This is the next industrial revolution, and it’s just getting started.”
The Fed kept rates unchanged on Wednesday, and the implied odds that the central bank will lower borrowing costs at its next meeting in September fell as Chair Jerome Powell warned that tariffs had pushed some prices higher. Still, investors appear to be zeroing in on the Big Tech results for now.
The yield on the benchmark 10-year U.S. Treasury note slipped 3 basis points to 4.35% on Thursday. The dollar was down 0.1% against a weighted basket of other currencies, and gold prices were flat at $3,351 an ounce.
