US stocks close Thursday sharply higher

The New York Stock Exchange closed higher on Thursday as investors focused on corporate earnings reports and data on the US economy.

The Dow Jones industrial average rose 1.19%, or 613.92 points, to close at 52,208.06.

The S&P 500 increased 1.66%, or 121.48 points, to finish at 7,437.63, while the Nasdaq Composite jumped 2.78%, or 679.24 points, to end the day at 25,122.18.

The Volatility Index (VIX), often referred to as the market’s “fear index,” decliend by 17.28% to 17.09.

Following a sharp decline in the stock market on Wednesday after the Fed's interest rate decision, the market took a positive turn as Microsoft reported strong financial results and concerns over artificial intelligence spending eased somewhat.

Strong revenue growth from Microsoft’s Azure cloud services and the company’s capital expenditure outlook—which fell short of market expectations—eased concerns about AI spending to some extent; Microsoft shares gained 15.5%.

Semiconductor stocks also rebounded, with Micron Technology shares rising 18.4% and Advanced Micro Devices (AMD) shares climbing 13%.

Among the tech companies that reported earnings yesterday, Meta announced that while its revenue rose 28% year-over-year to $60.8 billion in the second quarter, its net income fell 14% to $15.85 billion during the same period.

Meta shares fell 7.95% after the company announced that its free cash flow had declined in the second quarter.

On the macroeconomic data front, the US economy grew by 1.5% in the second quarter, falling short of expectations.

The personal consumption expenditures price index—closely monitored by the Fed as an inflation indicator—fell 0.1% on a monthly basis in June but rose 3.7% on an annual basis.

The core personal consumption expenditures price index, which excludes food and energy, also rose 0.1% on a monthly basis and 3.3% on an annual basis during the same period.

The number of people filing initial claims for unemployment benefits in the US rose to 197,000 in the week ending July 25, but remained below market expectations.

European markets

European stocks saw increases, except the UK, with the pan-European Stoxx Europe 600 index earned 0.77% to close at 649.95 points.

The UK’s FTSE 100 lost 0.1% to 10,897.27, while Germany’s DAX 40 rose 0.6% to 25,612.03 points, while France’s CAC 40 went up by 0.92% to 8,485.64.

Italy’s FTSE MIB 30 increased 1.29% to 52,104.38 points, and Spain’s IBEX 35 rose 1.78% to 19,757.70 points.