Wall Street closed out April on a high note Thursday, with the S&P 500 and Nasdaq Composite both setting new record highs and delivering their strongest monthly performances in years. The rally, however, faced an immediate test in after-hours trading as Apple's quarterly results sparked fresh concerns about the sustainability of the bull market.
The S&P 500 rose 73.05 points, or 1.02%, to 7,209.00, while the Nasdaq Composite gained 219.07 points, or 0.89%, to 24,892.31. The Dow Jones Industrial Average outperformed, surging 790.33 points, or 1.62%, to close at 49,652.14. According to Reuters data, the S&P 500 posted its largest monthly percentage gain since November 2020, and the Nasdaq recorded its best month since April 2020. The Dow's monthly climb was its strongest since November 2024.
The market's upward momentum was broad-based, with the Dow leading the charge. While the S&P 500 technology sector slipped, gains in communication services and industrials sectors provided support. Investor sentiment was buoyed by a series of solid earnings reports and easing concerns about economic data, according to Paul Nolte, senior wealth adviser and market strategist at Murphy & Sylvest. "The momentum is on the bullish side," Nolte told Reuters.
In after-hours trading, the focus shifted to Apple (AAPL), which reported fiscal second-quarter results that beat analyst expectations on both revenue and profit. Revenue came in at $111.18 billion, topping the consensus estimate of $109.66 billion, while earnings per share of $2.01 exceeded forecasts. However, iPhone sales of $56.99 billion missed the $57.21 billion analysts had predicted, causing shares to dip roughly 1% after the bell.
Apple CEO Tim Cook told Reuters that iPhone demand was "off the charts," but chip constraints limited the company's ability to fulfill orders. The board also authorized an additional $100 billion in share buybacks, matching last year's plan. Despite the revenue beat and strong services revenue, investors remained focused on the iPhone shortfall and sought more clarity on the company's AI strategy, including plans for Siri and third-party AI partnerships. Jacob Bourne of eMarketer highlighted Apple's tie-in with Google's Gemini as a notable move toward embracing external AI.
The Apple report followed a mixed week for megacap earnings. Alphabet (GOOGL) surged 10% after strong cloud results, while Meta Platforms (META) fell 8.7% and Microsoft (MSFT) dropped 3.9%, both pressured by concerns over rising capital spending on AI infrastructure and data centers.
Looking ahead, oil prices and AI spending remain key risks to the rally. Brent crude experienced volatility Thursday amid renewed geopolitical tensions, weighing on expectations for Federal Reserve rate cuts. If oil prices rise further or AI investment continues to outpace forecasts, the gains seen in April could unravel quickly. For now, the market is caught between solid earnings and the rising costs of sustaining growth, with Apple's after-hours performance potentially setting the tone for May.
