U.S. stocks edged higher on Thursday to extend gains seen in the previous session, with the S&P 500 and Nasdaq rising amid a sentiment boost from Big Tech earnings.
Summary
- Nasdaq and S&P 500 rose as investors reacted to quarterly earnings beats from Meta and Microsoft, while Apple and Amazon report later on Thursday.
- The Personal Consumption Expenditures index, a key inflation gauge preferred by the Federal Reserve, showed prices rose in June.
- President Donald Trump again criticized Fed chair Jerome Powell after the central bank left interest rates unchanged following its July meeting.
S&P 500 and Nasdaq surged 0.9% and 1.3% respectively in early trading Thursday, July 31, 2025.
Upside for the major indices aligned with positive investor sentiment following strong earnings reports by Meta (META) and Microsoft (MSFT). Meanwhile, the Dow Jones Industrial Average was up 112 points, or 0.25%.
As the week draws to a close, investors will hope for further gains amid corporate earnings and trade deals, despite a key inflation gauge showing a surge in prices in June.
Nasdaq gains, focus on Apple and Amazon earnings
Stocks jumped as Big Tech companies Microsoft and Meta reported earnings beats, with MSFT gaining 9% and META adding 12% in premarket trading on Thursday.
While Meta shares jumped after the stronger-than-expected earnings and AI guidance, MSFT rode the results to bring Microsoft close to a $4 trillion market valuation.
Earnings continue across Wall Street and attention now shifts to Apple (AAPL) and Amazon (AMZN) which report after the markets close. Experts say stocks may extend their rally on another better-than-expected report from the companies.
Trade deals and looming deadline
Stocks have benefitted from positive announcements around tariffs and trade deals ahead of President Trump’s deadline of Aug. 1.
Among these, the U.S. has agreed a deal with South Korea, which now faces 15% tariffs and commits $350 billion in investment and spending on energy. The United States has trade deals with the United Kingdom, the European Union, Japan, Vietnam and others.
Negotiations are also on for a U.S.-China deal. However, the U.S. is unlikely to strike a deal with Canada as Trump cites political disagreements.
Trump slams Fed’s Powell
Stocks seesawed on Wednesday following the Federal Reserve’s decision to hold interest rates steady.
Fed chair Jerome Powell announced the central bank would leave rates unchanged, with this the fifth-straight meeting at which Fed has taken the decision. Powell also noted that the Fed had not decided on a September rate cut.
President Donald Trump, who has previously slammed Powell over the rate cuts, again took issue. Trump said in a Truth Social post that “too late” Powell is “too political” and his decisions are hurting the U.S. economy.
As Powell comes under fresh scrutiny, investors’ focus largely shifts to Fed’s September meeting.
“I think they are going to cut in September ultimately, and then in December I’d go further and say you’ll probably get 100 basis points over the next year as inflation continues to come down,” James Bullard, former St. Louis Federal Reserve President, told CNBC in an interview.
Bullard’s comments came before the latest reading of the Personal Consumption Expenditures index. Per the data, core PCE, the Federal Reserve’s preferred inflation gauge showing prices rose in June as U.S. inflation stayed above the Fed’s 2% target.
Core PCE rose 0.3% in June and 2.8% year on year, above forecasts of 2.7%.
