US stocks surged on Thursday, with the S&P 500 reaching a fresh all-time high and the Dow Jones Industrial Average jumping over 400 points. Strong corporate earnings and signs of economic resilience lifted investor sentiment, even as oil prices retreated and global markets delivered mixed performances. Gains were boosted by optimism in the tech and industrial sectors, while cautious comments on interest rates and energy prices added to the complexity of the market narrative. As key economic data looms, traders remain focused on navigating both opportunities and challenges in an evolving global landscape.

Key Takeaways:

  • S&P 500 Hits New Record High: The S&P 500 climbed 0.53% to close at 6,118.71, setting a new all-time high for the second consecutive session. This surpassed the prior record of 6,090.27 achieved in early December. The index benefited from a combination of positive investor sentiment around potential tax cuts, deregulation, and resilient economic growth despite lingering trade concerns.
  • Dow Jumps Over 400 Points: The Dow Jones Industrial Average surged 408.34 points, or 0.92%, to close at 44,565.07. This marked its fourth consecutive day of gains, driven by optimism surrounding President Trump’s push for lower interest rates and oil prices. 
  • Nasdaq Posts Modest Gains: The Nasdaq Composite edged up 0.22% to 20,053.68, marking its fourth straight session of gains. While the broader tech sector saw mixed performance, the index remained lifted by strong investor sentiment and the ongoing fourth-quarter earnings season, which has delivered largely positive results.
  • European Markets Close Higher: The pan-European Stoxx 600 rose 0.44%, with most major indexes following suit. Germany’s DAX climbed 0.74%, or 157 points, to end at 21,289. France’s CAC 40 gained 0.7%, or 55 points, to close at 8,092, while the FTSE 100 added 0.23%, rising 20.07 points to 8,565.20. Italy’s FTSE MIB recovered 0.7%, closing at 36,113, breaking a three-day losing streak. Meanwhile, Euro zone consumer confidence rose by 0.3 points in January from the December number. However, Puma’s shares tumbled 23% following disappointing profit figures, weighing on broader sentiment.
  • Mixed Performance in Asian Markets: The CSI 300 in China led gains with a 1.01% rise to 3,835.34 after regulators encouraged large institutional investors to buy shares. Japan’s Nikkei 225 added 0.79%, closing at 39,958.87, while the Topix increased by 0.53% to 2,751.74. However, South Korea’s Kospi fell 1.24% to 2,515.49, and the Kosdaq dropped 1.13% to 724.01 amid concerns over the economy’s slowest quarterly growth since 2023. Australia’s S&P/ASX 200 also slipped 0.61% to 8,378.7 as investors remained cautious.
  • Oil Prices Fall After Trump’s Comments: US crude oil prices dropped 1.09% to $74.62 per barrel, while Brent crude fell 0.9% to $78.29. The declines came after President Trump urged Saudi Arabia and OPEC to reduce oil prices, further pressuring the market. Crude prices had been rising earlier in the session but turned negative following Trump’s remarks.
  • US Treasury Yields Edge Higher: The yield on the 10-year Treasury rose by 5 basis points to 4.644%, while the 2-year Treasury yield slipped marginally to 4.289%. Investors responded to mixed economic data and President Trump’s remarks on interest rates, with markets now looking ahead to key indicators, including the S&P Global Composite PMI Flash and existing home sales data for further direction.
  • US Weekly Jobless Claims Rise Slightly: Initial claims for state unemployment benefits rose by 6,000 to a seasonally adjusted 223,000 for the week ended January 18, slightly above the forecast of 220,000. Despite the marginal increase, jobless claims remain near historically low levels, reflecting a robust labour market. The data coincides with the period used to survey businesses for the January employment report, which is expected to show continued job growth after nonfarm payrolls increased by 256,000 in December.

FX Today:

  • EUR/USD Stabilises Above 1.0400: The EUR/USD pair edged up 0.10% to 1.0418 on Thursday, holding above key support at 1.0400 as it recovered from recent lows of 1.0300. Immediate resistance is positioned at 1.0450, with a break above targeting the 100-day SMA at 1.0697. On the downside, support lies at 1.0350, with further key support at 1.0300, a level that has provided a strong base in recent sessions. Momentum indicators signal stabilisation, with RSI trending higher but remaining below neutral levels, while MACD shows easing bearish momentum. The pair’s overall outlook remains bearish as it continues to trade below the 200-day SMA at 1.0772.
  • GBP/USD Advances Amid Positive Sentiment: GBP/USD rose 0.33% to 1.2356 on Thursday, extending its recovery from recent lows near 1.2100. The pair is approaching resistance at 1.2400, with a break above targeting the 50-day SMA at 1.2534. On the downside, support lies at 1.2300, followed by 1.2250, which aligns with the 100-day SMA at 1.2815. Momentum indicators suggest strengthening bullish conditions, with RSI trending higher and MACD showing growing upward momentum. However, the pair remains below its 200-day SMA at 1.2789, signalling a broader bearish trend. 
  • USD/JPY Retreats Amid Consolidation: The USD/JPY pair slipped 0.36% to 155.95 on Thursday as it consolidated after failing to breach resistance at 157.00. Immediate resistance lies at 156.50, with a potential break targeting the November 2024 high of 157.50. On the downside, support is seen at 155.50, followed by the 100-day SMA at 151.29. Momentum indicators show weakening bullish momentum, with RSI retreating from overbought territory and MACD signalling a waning bullish bias. 
  • Gold Holds Firm in Volatile Trade: Gold traded at $2,752 on Thursday, down 0.10% for the day, as it consolidated after testing a multi-month high of $2,758. Immediate resistance lies at $2,760, with a break above potentially targeting the psychological level of $2,800. On the downside, support is seen at $2,740, followed by the 100-day SMA at $2,650. Momentum indicators suggest consolidation, with RSI stabilising near overbought levels and MACD maintaining a bullish signal. Gold’s long-term uptrend remains intact, supported by its position above the 200-day SMA at $2,518. Market participants are closely monitoring inflation expectations and central bank policy developments for further direction. A sustained break above $2,760 could renew bullish momentum, while a failure to hold above $2,740 risks deeper retracement.
  • Silver Retreats Amid Rising US Yields: Silver traded at $30.44 on Thursday, down 1.10% for the day, as it faced renewed selling pressure after testing the $31.000 resistance level. The pullback reflects the influence of rising US Treasury yields, with immediate support at $30.10, aligned with the 50-day SMA. A break below this level would target $29.50, signalling further downside risks. On the upside, resistance remains at $30.80, with a potential break opening the door to $31.50. Momentum indicators show mixed signals, with RSI retreating slightly from overbought levels and MACD reflecting weakening bullish momentum. Silver’s long-term outlook remains positive, supported by the 200-day SMA at $30.04.

Market Movers:

  • American Airlines Drops on Weak Guidance: Shares of American Airlines plunged 8.7% on Thursday after the company issued disappointing first-quarter guidance. The airline projected an adjusted loss of $0.20 to $0.40 per share, significantly below analysts’ expectations of a $0.04 loss per share, according to LSEG. 
  • Electronic Arts Tumbles on Reduced Bookings Guidance: Electronic Arts’ stock plummeted 16.7% after the video game publisher slashed its net bookings guidance for both the third quarter and the full year. 
  • Puma Slumps on Disappointing Sales Results: Puma shares fell sharply by 23% on Thursday after the company reported full-year 2024 profits below market expectations. Net income declined by 7.5% year-on-year to €282 million ($293.2 million), prompting analysts at broker Metzler to downgrade the stock to “hold.” 
  • Guidewire Software Jumps on Positive Coverage: Guidewire Software’s stock surged 11.5% after Goldman Sachs initiated coverage with a “buy” rating. The firm highlighted the company’s potential to outperform as cloud adoption accelerates among insurers, underscoring Guidewire’s strategic position in the insurance technology sector.
  • AST SpaceMobile Drops on Convertible Note Offering: Shares of AST SpaceMobile sank 11.9% after the satellite communications company announced a $400 million convertible note offering. The announcement raised concerns about shareholder dilution, pressuring the stock.
  • Plexus Falls on Weak Revenue Outlook: Plexus shares dropped 10.1% after the company provided a disappointing revenue forecast for the second quarter. The electronics manufacturer expects revenue in the range of $960 million to $1 billion, falling short of the $1.02 billion expected by analysts.

As markets wrapped up a dynamic session on Thursday, the S&P 500 and Dow Jones surged to new highs. However, mixed results in global markets highlighted underlying uncertainty, with European equities rising modestly, while Asia-Pacific markets delivered uneven performances, led by a rally in China but declines in South Korea and Australia. Meanwhile, oil prices declined sharply following Trump’s comments, and Treasury yields edged higher as investors digested labour market data and upcoming economic reports. As the week progresses, all eyes remain on economic indicators, corporate earnings, and central bank policies to gauge the trajectory of markets in the near term.