U.S. stocks finished sharply higher Thursday, with Microsoft helping power a broad advance in technology shares. The rally pushed the S&P 500 up 1.66%, while the Dow Jones Industrial Average added 1.19%. The Nasdaq 100 also moved higher as investors rotated back into large-cap tech names.
Market sentiment appeared to improve even after a softer-than-expected reading on second-quarter economic growth. U.S. Q2 GDP rose at a 1.5% annualized pace, below expectations for 2.0%. At the same time, personal consumption increased 3.2%, indicating that consumer demand remained stronger than many analysts had projected.
Investors were also watching inflation data closely. The Q2 core PCE price index eased to 3.4%, a sign that underlying price pressures may be cooling. That combination of slower headline growth and moderating core inflation can be supportive for equities, especially rate-sensitive technology stocks, because it may strengthen expectations for a less restrictive policy outlook.
With Microsoft leading the move, the session reflected renewed appetite for major tech companies after a closely watched batch of economic updates. By the close, the main indexes had posted solid gains, with the strongest momentum centered in the technology sector.
