Wall Street closed higher on Thursday, with the Nasdaq Composite leading gains as semiconductor stocks surged following President Trump's announcement that Apple will collaborate with Intel on U.S. chip design and manufacturing. The S&P 500 rose 1.07% to 7,499.77, the Nasdaq climbed 1.48% to 26,406.98, and the Dow Jones Industrial Average added 0.35% to 51,672.80, according to MarketWatch data.
The rally was driven by a sharp bounce in chip shares after Trump revealed the Apple-Intel partnership, which is expected to boost Intel's foundry business. The Philadelphia semiconductor index outperformed the broader market, with Intel shares rising alongside Nvidia and Micron. Eric Johnston, chief equity and macro strategist at Cantor, told Reuters that semiconductors, lower oil prices, and a shift in how traders view the Federal Reserve were the three factors fueling the rally.
Oil prices provided additional support, as Brent crude finished up 0.4% at $79.85 a barrel after trading lower for most of the session, while U.S. crude edged down 0.2% to $75.85. Lower oil prices ease inflation pressures by reducing costs for transportation, production, and households.
The market's gains came despite lingering uncertainty about the Federal Reserve's rate path. On Wednesday, Fed officials held the benchmark rate steady at 3.5% to 3.75% and raised their year-end federal funds rate projection to 3.8%, up from 3.4% in March. Traders still see a 50% probability of a 25-basis-point rate hike in September, according to Reuters.
Markets closed early ahead of the Juneteenth holiday, with the NYSE set to close Friday. The shortened trading week left investors with limited time to react to news on oil, rates, and global headlines before the long weekend.
While tech stocks led the charge, not all sectors participated in the rally. Accenture shares fell after the company trimmed its full-year local currency revenue-growth target to 3%-4%, despite reporting $18.7 billion in quarterly revenue and a 9% EPS increase. CEO Julie Sweet highlighted an increase in large-scale AI transformation programs, but investors focused on the guidance cut. Cognizant, Gartner, and IBM also traded lower.
Kroger shares dropped after earnings missed forecasts, and SpaceX declined for a second consecutive session. These losses pulled the Dow back relative to the Nasdaq, as traders focused on specific stocks rather than buying across the board.
Adam Turnquist, chief technical strategist at LPL Financial, noted ongoing uncertainty about potential flare-ups and the path forward for Iran's nuclear program, keeping oil prices as a risk factor for stocks. He described Thursday's bounce as a pressure release rather than a full market reset.
With the Fed providing less clear guidance and the holiday weekend ahead, investors now wait for trading to resume to see if the gains can be sustained.
