Stocks Bounce Back as Tech Earnings Disappoint

Major stock indices rebounded on positive sector performance, offsetting weak earnings from technology giants. Bonds rallied amid a lackluster US services sector report.

Market Highlights:

* Over 350 S&P 500 companies gained, erasing earlier losses.
* Tech heavyweight Nvidia Corp. led gains in the semiconductor industry.
* The "Magnificent Seven" tech giants declined 1.8%, led by Alphabet Inc.'s Google and Advanced Micro Devices Inc.
* Treasury yields dropped to lows not seen since 2025.
* The US dollar weakened.

Economic Considerations:

* Market fluctuations have been influenced by uneven economic data, trade tensions, and concerns about the return on investments in artificial intelligence (AI).
* Mark Hackett at Nationwide emphasizes that volatility can emerge unexpectedly, reminding investors to manage risk throughout the year.
* AI startup DeepSeek's emergence has sparked questions about the profitability of AI investments.
* Large-cap companies continue to increase capital expenditures and adopt productivity-enhancing technologies.

Corporate News:

* MicroStrategy Inc. changed its name to Strategy.
* Chipotle Mexican Grill Inc.'s sales missed expectations.
* Walt Disney Co.'s revenue exceeded estimates, driven by "Moana 2" and streaming services.
* Johnson Controls International Plc gained after upgrading its profit forecast and hiring a new CEO.
* Match Group Inc. appointed Spencer Rascoff as CEO, replacing Bernard Kim.
* Snap Inc.'s earnings outlook disappointed despite strong revenue gains.

Key Upcoming Events:

* Eurozone retail sales (Thursday)
* UK rate decision (Thursday)
* US initial jobless claims (Thursday)
* Amazon earnings (Thursday)
* US nonfarm payrolls, unemployment, and University of Michigan consumer sentiment (Friday)

Market Movements as of 2:32 p.m. New York Time:

Stocks:

* S&P 500: +0.2%
* Nasdaq 100: +0.2%
* Dow Jones Industrial Average: +0.6%
* MSCI World Index: +0.4%
* Bloomberg Magnificent 7 Total Return Index: -1.8%
* Russell 2000 Index: +1%

Currencies:

* Bloomberg Dollar Spot Index: -0.3%
* Euro: +0.3% to $1.0412
* British pound: +0.2% to $1.2511
* Japanese yen: +1.2% to 152.45 per dollar

Cryptocurrencies:

* Bitcoin: +0.7% to $97,237.96
* Ether: +4.9% to $2,770.01

Bonds:

* 10-year Treasury yield: -9 basis points to 4.42%
* Germany's 10-year yield: -3 basis points to 2.37%
* Britain's 10-year yield: -8 basis points to 4.44%

Commodities:

* West Texas Intermediate crude: -2.1% to $71.15 a barrel
* Spot gold: +0.9% to $2,867.42 an ounce