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Artificial intelligence stocks drove modest gains across U.S. markets on Thursday, helping Wall Street recover from a three-day losing streak despite ongoing turbulence in global bond markets. The S&P 500 climbed 0.3 per cent, the Dow Jones Industrial Average added 211 points or 0.4 per cent by 9:35 a.m. Eastern time, and the Nasdaq composite rose 0.5 per cent.
Micron Technology Beats Expectations
Memory chip maker Micron Technology sparked much of the optimism after it delivered a stronger-than-expected quarterly profit report. The company also issued forecasts for upcoming revenue and profit that exceeded analyst estimates. Furthermore, Micron said growth is strengthening across its business.
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CEO Sanjay Mehrotra credited the AI boom for driving demand for memory chips. Despite the strong results, Micron’s stock edged down 0.1 per cent on Thursday. Analysts attributed the dip to the stock’s already remarkable run — it had gained more than 270 per cent for the year heading into the day, far outpacing the S&P 500’s gain of less than 12 per cent.
However, Micron’s upbeat outlook lifted other AI-related stocks. Nvidia rose 0.6 per cent, while Alphabet climbed 1.5 per cent after Google released its latest AI model, Gemini 4 Argon.
Bond Market Pressure Continues
The stock gains came despite continued volatility in bond markets worldwide. The yield on the 10-year U.S. Treasury note edged up to 5.30 per cent from 5.29 per cent late Wednesday. That level sits near its highest point since 2002.
The 10-year yield has climbed sharply in recent weeks, rising from below 5 per cent roughly a week ago and from below 4 per cent before the war with Iran began. Higher yields make borrowing more expensive for consumers and businesses. As a result, they tend to slow economic growth and weigh on stock prices.
Several factors are pushing yields higher. These include concerns about persistent inflation, rising oil prices, signs of a resilient U.S. economy, and Washington’s continued deficit spending. Meanwhile, oil prices added further inflationary pressure on Thursday. Brent crude rose 1.9 per cent to US$99.88 per barrel, as uncertainty about the war with Iran kept global energy markets unsettled.
U.S. Economy Shows Resilience
New data on Thursday pointed to continued strength in the U.S. economy. Fewer workers filed for unemployment benefits last week, suggesting layoffs remain limited. That followed a Wednesday report showing U.S. economic growth in the spring was even stronger than earlier estimates indicated.
In Canada, the Toronto Stock Exchange dipped about 0.1 per cent at the open. Technology stocks posted gains, but losses in the financial and banking sector offset them. Shopify rose 2.3 per cent, BlackBerry gained 2.5 per cent, and Constellation Software climbed nearly 4 per cent. In contrast, shares of several major Canadian banks fell between approximately 0.75 and 1.5 per cent each.
Global Markets React to Bond Volatility
European markets also felt the pressure from rising bond yields. London’s FTSE 100 dropped 0.8 per cent after the yield on the 10-year U.K. government bond briefly spiked to 5.53 per cent before pulling back to 5.42 per cent. Similarly, Paris’s CAC 40 fell 0.6 per cent following an early jump in the French 10-year government bond yield.
Asian markets, however, finished the session on a stronger note. Optimism around AI following Micron’s profit report boosted investor sentiment across the region. Japan’s Nikkei 225 jumped 3.3 per cent, and South Korea’s Kospi gained 1.9 per cent.
