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U.S. stocks experienced gains on Thursday, driven primarily by the Nasdaq, as strong earnings reports from Microsoft and Meta eased investor concerns about the potential economic impacts of escalating trade tensions between the U.S. and China.

Nasdaq Leads Gains with Microsoft and Meta

The Nasdaq Composite index ended the day up 1.52%, even though it closed near session lows. This growth was largely supported by a 7.6% rise in Microsoft shares and a 4.2% increase in Meta stock. Both companies reported better-than-expected quarterly profits late Wednesday, alleviating fears that global uncertainty and tariffs could negatively impact revenue streams from artificial intelligence, cloud computing, and advertising.

Broader Market Performance

The S&P 500 also posted gains, climbing 0.63%. Meanwhile, the Dow Jones Industrial Average added 0.21%, marking its longest winning streak for the year. Despite broader concerns about slowing economic growth, markets remained optimistic.

However, some economic indicators showed signs of weakness. Weekly jobless claims rose to a two-month high, while U.S. GDP contracted in the first quarter. These factors heightened expectations for a weaker labor market ahead of the upcoming jobs report.

Key Earnings Ahead: Apple and Amazon

Investors are now turning their attention to earnings reports from Apple and Amazon, which are expected to be released after the market closes. Both companies face challenges stemming from trade policies. Amazon has stated it will not pass tariff costs onto consumers, while Apple is actively working to shift iPhone production away from China to mitigate risks.

In the broader market, McDonald’s reported weaker consumer demand and tariff-related pressures, which contributed to a decline in U.S. sales. The company’s shares dropped 2% after missing expectations for the first quarter.

Geopolitical Developments in Trade

On the geopolitical front, Beijing has signaled that Washington may be willing to restart trade talks. However, the Trump administration has maintained that China must take the first step. According to sources within the White House, a fresh round of trade agreements could be on the horizon, potentially easing tensions in the global economy.

As investors monitor these developments, they remain focused on how trade negotiations and macroeconomic factors will influence market conditions in the coming weeks.

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