NEW YORK – The U.S. stock market surged on Thursday, pushing the S&P 500 to within a whisker of its all-time closing high, set back in February. The benchmark index climbed 0.8%, ending just 0.05% shy of its peak, and briefly surpassed it during intrad trading. This remarkable recovery marks a significant rebound for the S&P 500, which had plummeted approximately 20% from its record earlier in the spring due to anxieties surrounding U.S. President Donald Trump’s proposed tariffs.
The Dow Jones Industrial Average rallied 404 points (0.9%), while the Nasdaq composite gained 1%.
Leading the charge was McCormick, the spice giant, whose shares jumped 5.3% after reporting stronger-than-expected profits and an optimistic full fiscal year forecast, including strategies to mitigate tariff-induced cost increases.
Over the longer term, technology giants have continued their market dominance, particularly since the S&P 500 hit its low point in April. Chipmaker Nvidia, a frontrunner in the artificial intelligence (AI) boom, saw its stock rise 0.5%, solidifying its position as the most valuable company in the U.S. stock market. Nvidia has soared 61% since April 8, vastly outperforming the S&P 500’s 23% gain during the same period. Another AI beneficiary, Super Micro Computer, also saw a 5.7% increase, bringing its post-April 8 gain to 55%.
Micron Technology, a producer of computer memory and data storage, experienced volatile trading before closing down 1%, despite exceeding analyst expectations for its latest quarter’s profit and revenue. CEO Sanjay Mehrotra highlighted growing AI-driven memory demand and provided an optimistic profit forecast for the current quarter.
In Thursday’s trading, the S&P 500 rose 48.86 points to close at 6,141.02. The Dow Jones Industrial Average gained 404.41 points, reaching 43,386.84, and the Nasdaq composite added 194.36 points, closing at 20,167.91.
While Wall Street’s initial alarm over Trump’s tariffs has somewhat subsided since their shocking proposal in April, concerns have not entirely vanished. Investors are still awaiting clarity on the ultimate scope of the tariffs, their potential economic impact, and their contribution to inflation.
Recent economic reports offered mixed, but generally stabilizing, signals. Data released Thursday showed that orders for durable manufactured goods grew more than economists anticipated last month, and fewer U.S. workers filed for unemployment benefits, hinting at fewer layoffs. Although a separate report indicated a larger contraction in the U.S. economy during the first three months of 2025 than previously estimated, many economists attribute this to a surge in foreign product purchases by U.S. companies anticipating tariffs, and they expect improved performance in the coming months.
In the bond market, Treasury yields fluctuated before easing. The yield on the 10-year Treasury fell to 4.24% from 4.29% on Wednesday, while the two-year Treasury yield, which often reflects Federal Reserve policy expectations, dropped to 3.71% from 3.74%.
Analysts suggested that bond yields might have been influenced by a Wall Street Journal report indicating that President Trump could name his nominee to replace Fed Chair Jerome Powell unusually early, potentially undermining the current chair. Such a move could erode investor confidence in the Fed’s independence in managing inflation.
Fed Chair Powell has recently reiterated that the central bank is monitoring the effects of Trump’s tariffs on the economy before deciding when to resume interest rate cuts, which have been paused this year to avoid fueling inflation. However, Trump has consistently pushed for earlier rate cuts and has publicly criticized Powell. Adding to the pressure, two of Trump’s Fed appointees recently indicated they would consider cutting rates as early as the Fed’s next meeting in July.
Brian Jacobsen, chief economist at Annex Wealth Management, observed that the falling yields, weakening dollar, and rising breakeven inflation rates “all suggesting that a puppet of the White House in the seat of the Chair could be bad for inflation.” Nevertheless, Jacobsen emphasized that interest rate decisions ultimately rest with a committee of Fed officials, not just the chair, potentially allowing other officials to “keep the new leader in check if needed.”
Global markets showed a mixed performance, with European indexes varying and Asian markets closing mixed. Japan’s Nikkei 225 climbed 1.6%, while South Korea’s Kospi fell 0.9%.