NextFin News - U.S. stocks closed sharply higher Thursday as blowout earnings from Nvidia, Salesforce, CrowdStrike, and Okta powered a broad rally in technology and enterprise software, even as a hawkish Jackson Hole appearance from a Federal Reserve official injected a note of caution into the rate outlook. The session's central tension pitted renewed confidence in the AI investment cycle against persistent inflation concerns, with the Cleveland Fed's Beth Hammack repeating her call for higher interest rates from the Fed's annual symposium in Wyoming. Despite that hawkish note, the earnings-driven optimism dominated, with the Nasdaq posting its best session in weeks — though the rally notably left the memory and storage complex behind.
The Dow Jones Industrial Average rose 0.20% The S&P 500 Index rose 0.72% The Nasdaq Composite advanced 1.57%
Stock & Sector Performance
Enterprise software and AI infrastructure were the standout theme of the session by a wide margin. Salesforce surged roughly 21.55% from Wednesday's close, combining its post-earnings after-hours pop with continued gains during the regular session, after reporting second-quarter revenue of $11.35 billion versus an $11.32 billion consensus and adjusted earnings per share of $5.90, more than double a year ago on an investment gain; the move was large enough to add an estimated 160 points to the Dow on its own. Okta jumped about 19% after reporting adjusted earnings of $1.05 per share on revenue of $805 million, both ahead of expectations. A closely watched software-sector ETF climbed 6.5% on the combined strength of Salesforce's and CrowdStrike's forecasts. On the downside, McDonald's fell 2.63%, Walt Disney dropped 2.58%, and Merck declined 2.27%, capping the Dow's overall advance despite the tech-led strength elsewhere.
Magnificent Seven trading was led decisively by Nvidia, which closed up approximately 8.16%–9% after the company said it expects revenue to grow roughly 70% in its next fiscal year, easing investor concerns about a slowdown in AI infrastructure spending. Reliable closing figures for Apple, Microsoft, Amazon, Alphabet, Meta, and Tesla were not available in today's reporting at publication time, though the group's performance was overshadowed by Nvidia's outsized move and the broader software-sector rally.
Memory & Storage: The Rally's Notable Laggard
While the broader chip complex rode Nvidia's coattails higher — the iShares Semiconductor ETF (SOXX) added about 0.8% — the memory and storage names diverged sharply, unwinding for a second straight session even as Nvidia disclosed a dramatic increase in its own memory purchase commitments. Micron Technology fell roughly 2.9%, Western Digital dropped about 3.8%, and SanDisk slipped 1.4%, while the Roundhill Memory ETF (DRAM) declined about 1.45%. SK Hynix was the lone gainer in the group, up roughly 0.4%. The moves came despite Nvidia CFO Colette Kress disclosing on Wednesday's earnings call that the company's supplier commitments jumped to $279 billion from $119 billion the prior quarter, "primarily related to the procurement of memory" — a disclosure that initially lifted memory names in overnight trading before the group reversed lower once Thursday's cash session got underway. The divergence illustrates a classic expectations-reset dynamic: Micron and Western Digital each carried year-to-date gains above 170%–230% heading into today, leaving the group vulnerable to profit-taking even on fundamentally bullish news.
Major Company Story of the Day
Nvidia's fiscal second-quarter earnings remained the dominant single-company story shaping Thursday's session. Beyond the headline beat-and-raise results reported after Wednesday's close, the stock's continued strength through Thursday's regular session — building on its after-hours reversal the night before — reflected investor conviction that CEO Jensen Huang's guidance for approximately 70% revenue growth in the next fiscal year, along with confirmation that memory supply will remain constrained through fiscal 2028, represents a durable multi-quarter demand signal rather than a single-quarter beat. The disclosure of Nvidia's $279 billion in supplier commitments added a new data point to that thesis, even as the memory stocks most directly tied to that spending failed to hold on to the news.
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