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US Stocks Rise as Concerns Ease
US stocks rose during trading on Thursday, May 1, after strong quarterly results from two tech giants eased concerns about the slowdown in artificial intelligence (AI) amid economic turmoil.
The S&P 500 rose 1%, and the Nasdaq Composite jumped 1.7%. The Dow Jones Industrial Average rose 237 points, or 0.6%.
Investor concerns that US President Donald Trump's tariffs and a US economic slowdown could threaten the future of the AI sector were allayed after Meta Platforms reported better-than-expected first-quarter revenue. CEO Mark Zuckerberg said on an earnings call on Wednesday that the company is "performing excellently" and is "well-positioned to weather the macroeconomic uncertainty." The company's shares rose more than 5%.
Microsoft also reported better-than-expected revenue and net profit for its fiscal third quarter, along with strong results from its Azure cloud business. Furthermore, the company delivered an upbeat outlook, allaying some concerns about the performance of technology companies in the coming months. These results sent shares up nearly 9% in Thursday trading.
Other stocks, such as Nvidia, a leading AI chip company, also gained more than 3%.
"Stocks are rarely immune to Trump's tariffs and trade war, but AI is far less affected than investors currently believe," said Jed Ellerbrock, portfolio manager at Argent Capital Management.
"We are at the beginning of a very steep growth curve, and that's true for AI infrastructure," Ellerbrock added.
A rise in weekly US unemployment claims to 241,000, exceeding the Dow Jones Industrial Average's estimate of 225,000, weighed on Thursday's positive outlook.
