Key Takeaways
- • U.S. stock indexes rose Thursday as earnings beats led the market, with the S&P 500 up 0.3% to 7,744.06 and the Dow up 556.21 points (1.1%) to 52,177.69, according to the Associated Press.
- • A sell-off in AI stocks that began on Wall Street Wednesday spread worldwide, sending South Korea's Kospi down 7.6% and Japan's Nikkei 225 down 4.9% before the S&P 500 dipped at the start of Thursday's session.
- • Nvidia fell 1.8% and was the heaviest drag on the S&P 500, but its early loss of 3.8% had more than halved by the close, and Taiwan Semiconductor finished down 1.8% after an early drop of 5.3%.
- • The 10-year Treasury yield eased to 5.09% from 5.19%, after briefly topping 5.30% earlier in the month, its highest level since 2002.
- • Concern persists that high bond yields and heavy AI-related borrowing could limit the durability of the AI spending boom.
Summary
U.S. stock indexes moved higher on Thursday, led by companies reporting stronger-than-expected profits, and pulled closer to their records even as artificial-intelligence stocks continued to swing. The S&P 500 rose 0.3% to 7,744.06 after erasing an early loss and moved closer to the all-time high it set the previous week. The Dow Jones Industrial Average gained 556.21 points, or 1.1%, to 52,177.69, and the Nasdaq composite added 0.1%, or 20.16 points, to 26,713.03.
Earnings drove many of the day's gains. Marsh & McLennan, the insurance and professional services firm that recently updated its brand name to Marsh, rose 4.6% after reporting a stronger summer-quarter profit than analysts expected. Kimberly-Clark climbed 4.7% after saying it expects revenue and profit for the latest quarter to exceed analyst forecasts, and Bank of New York Mellon rose 3.2% after a stronger-than-expected profit, with CEO Robin Vince citing strength across its regions.
The session began far more weakly. A sell-off in AI stocks that started on Wall Street Wednesday spread across global markets, sending South Korea's Kospi down 7.6% and Japan's Nikkei 225 down 4.9%. South Korea's loss was the steepest of the day; the Kospi is dominated by Samsung Electronics and SK Hynix, and it has fallen 39% since setting a record in June. Europe fared better given its smaller exposure to technology, with London's FTSE 100 rising 1.1%.
AI leaders were volatile. Nvidia, which has risen nearly 1,415% since the end of 2022 and is Wall Street's most valuable company, fell 1.8% and was the largest weight on the S&P 500, though it had been down 3.8% early in the day. Taiwan Semiconductor Manufacturing Co.'s U.S.-listed shares fell as much as 5.3% before finishing down 1.8%, despite a quarterly profit that topped analysts' high expectations; CFO Wendell Huang said the company expects strong demand to continue through the final three months of 2026. CoreWeave, which provides cloud-based AI computing power, dropped as much as 9.5% after falling 15.5% the previous day, then finished 5.9% higher.
AP notes that concern about AI has grown as companies borrow heavily to fund data centers and AI chips. Rising global bond yields have made borrowing more expensive and raised questions about how long the spending boom can last, and high yields generally make investors less willing to pay premium prices for stocks. In the bond market, Treasury yields fell, with the 10-year sinking to 5.09% from 5.19% late Wednesday. The yield had topped 5.30% earlier in the month, its highest level since 2002, on concerns about inflation and a strong economy. The decline came even though another report showed inflation worsened more than economists expected, while strong retail sales and fewer jobless claims also surfaced.
Earnings drove many of the day's gains. Marsh & McLennan, the insurance and professional services firm that recently updated its brand name to Marsh, rose 4.6% after reporting a stronger summer-quarter profit than analysts expected. Kimberly-Clark climbed 4.7% after saying it expects revenue and profit for the latest quarter to exceed analyst forecasts, and Bank of New York Mellon rose 3.2% after a stronger-than-expected profit, with CEO Robin Vince citing strength across its regions.
The session began far more weakly. A sell-off in AI stocks that started on Wall Street Wednesday spread across global markets, sending South Korea's Kospi down 7.6% and Japan's Nikkei 225 down 4.9%. South Korea's loss was the steepest of the day; the Kospi is dominated by Samsung Electronics and SK Hynix, and it has fallen 39% since setting a record in June. Europe fared better given its smaller exposure to technology, with London's FTSE 100 rising 1.1%.
AI leaders were volatile. Nvidia, which has risen nearly 1,415% since the end of 2022 and is Wall Street's most valuable company, fell 1.8% and was the largest weight on the S&P 500, though it had been down 3.8% early in the day. Taiwan Semiconductor Manufacturing Co.'s U.S.-listed shares fell as much as 5.3% before finishing down 1.8%, despite a quarterly profit that topped analysts' high expectations; CFO Wendell Huang said the company expects strong demand to continue through the final three months of 2026. CoreWeave, which provides cloud-based AI computing power, dropped as much as 9.5% after falling 15.5% the previous day, then finished 5.9% higher.
AP notes that concern about AI has grown as companies borrow heavily to fund data centers and AI chips. Rising global bond yields have made borrowing more expensive and raised questions about how long the spending boom can last, and high yields generally make investors less willing to pay premium prices for stocks. In the bond market, Treasury yields fell, with the 10-year sinking to 5.09% from 5.19% late Wednesday. The yield had topped 5.30% earlier in the month, its highest level since 2002, on concerns about inflation and a strong economy. The decline came even though another report showed inflation worsened more than economists expected, while strong retail sales and fewer jobless claims also surfaced.
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