Wall Street indexes posted strong gains on Thursday, with investors responding enthusiastically to a mix of upbeat corporate earnings and fresh signals of potential progress in U.S.-China trade relations. The rally reflected growing investor optimism that the worst of the trade war fallout might soon ease, helping lift overall market sentiment across multiple sectors.
Tech and Consumer Stocks Drive Market Gains
The day’s most impressive performances came from ServiceNow and Hasbro, two companies that exceeded Wall Street’s expectations with their quarterly results. Shares of ServiceNow surged by 14.8% following its strong earnings report, helping propel the broader information technology sector to a 2.7% gain. Investors responded to the company’s solid growth in cloud services and its positive guidance for the remainder of the year.
Hasbro also delivered standout results. The toymaker posted a 15.7% gain, boosted by strong sales in its digital gaming division and improved supply chain efficiencies. Hasbro’s performance added momentum to consumer discretionary stocks and reassured markets that consumer activity remained healthy, despite ongoing global tensions.
These corporate performances reflected broader trends seen in the earnings season. According to data compiled by LSEG, approximately 73.9% of the 157 S&P 500 companies that have reported first-quarter results so far beat analyst expectations. This high percentage indicates that U.S. businesses have continued to adapt successfully, even amid the backdrop of tariff uncertainty and geopolitical noise.
Trade Optimism Lifts Investor Mood
Markets also gained traction from renewed signs of trade de-escalation between the United States and China. U.S. Treasury Secretary Scott Bessent addressed the ongoing tariff standoff, labeling the current reciprocal levies between the two economic giants as “unsustainable.” His comments marked a clear shift from earlier rhetoric and came one day after reports suggested that the White House was considering reducing certain tariffs on Chinese imports.
These developments fueled optimism among investors who have closely monitored the trade dispute’s effects on global supply chains, manufacturing costs, and market volatility. Ulrike Hoffmann-Burchardi, Chief Investment Officer for Global Equities at UBS Global Wealth Management, noted, “Recent developments suggest a less aggressive approach to resolving trade disputes.” She emphasized that the market’s rebound reflected rising confidence that the most damaging outcomes from the trade war could be avoided.
While sentiment improved, both the U.S. and China maintained firm positions. Bessent clarified that any move to cut tariffs would require reciprocal steps and that no unilateral decisions were on the table. In response, Chinese officials stated that the U.S. should lift all unilateral tariff measures if it genuinely wants to resolve the issue. These statements indicated that negotiations remain delicate, and future headlines will continue to shape short-term market movements.
Positive Economic Data Supports Momentum
Investor confidence received an additional boost from favorable economic data released Thursday morning. Weekly jobless claims rose only modestly, suggesting the labor market remains stable despite pressure from inflation and monetary policy shifts.
More importantly, March durable goods orders jumped sharply, surprising analysts who expected only a modest increase. The report indicated strong business investment in equipment and long-term assets—a sign that corporate America maintains confidence in the economic outlook. The strength in durable goods suggested that companies are still expanding and planning for growth despite lingering concerns about interest rates and trade policy.
This economic resilience, combined with strong corporate earnings, created a perfect environment for market gains.
Major Indexes Post Impressive Gains
By late morning in New York, all three major U.S. indexes had posted significant gains:
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The Dow Jones Industrial Average rose 310.48 points (0.78%) to 39,917.56.
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The S&P 500 climbed 78.96 points (1.47%) to 5,454.82.
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The Nasdaq Composite jumped 338.19 points (2.02%) to 17,046.06.
These moves reflected broad-based buying, particularly in technology, industrials, and consumer discretionary sectors. The Nasdaq led the rally, benefiting from a renewed appetite for growth stocks amid declining concerns about aggressive Federal Reserve action.
A Cautiously Optimistic Outlook
While Thursday’s surge provided a much-needed confidence boost, market participants continue to tread carefully. The backdrop of trade negotiations, global inflation, and central bank decisions still holds the potential to trigger volatility. Investors now wait for further clarity on monetary policy, inflation data, and geopolitical developments before committing more heavily to risk assets.
Bessent’s comments represented a shift in tone but did not offer specific timelines or commitments. Similarly, China’s response reiterated past demands rather than signaling a clear path to resolution. Analysts remain watchful, noting that trade policy shifts have sparked sharp swings in both directions over the past year.
Investors should also prepare for further short-term market fluctuations, especially as new earnings reports and macroeconomic data emerge. Ulrike Hoffmann-Burchardi noted, “The upcoming news flow will likely continue to drive short-term swings.” This reflects the reality that today’s optimism can shift quickly if data or policy announcements disappoint.
Investors Eye the Fed and Inflation Trends
Beyond corporate earnings and trade policy, monetary policy and inflation continue to shape market sentiment. While the Federal Reserve has paused rate hikes for now, inflation remains above target, and policymakers remain cautious. Investors closely track Fed commentary for any signs of a return to tightening or an early pivot to cuts.
With durable goods orders strong and jobless claims under control, the Fed may see justification for holding rates steady. However, any signs of rising inflation or slowing consumer demand could change that equation quickly.
Market sentiment has improved, but caution remains key. Investors with long-term goals continue to diversify and focus on high-quality companies with strong fundamentals. Traders, meanwhile, respond to day-to-day data and headlines that shift market momentum.
Conclusion
Thursday’s market rally showcased the positive intersection of strong earnings, optimistic economic data, and hints of trade de-escalation. ServiceNow and Hasbro led a strong day for corporate earnings, boosting tech and consumer stocks. Meanwhile, the suggestion of tariff rollbacks and healthy durable goods data created a stronger outlook for U.S. growth.
Despite this optimism, unresolved trade tensions and monetary policy questions continue to influence market behavior. Investors should remain alert to potential reversals and prepare for volatility as more information emerges.
For now, Wall Street has welcomed the signs of relief. Strong earnings, resilient economic indicators, and a shift in trade tone provided enough fuel for a market rebound—at least for the moment.
