Wall Street opened higher on Thursday, extending the momentum from a strong prior session that saw the benchmark indices reach record levels. Investor sentiment has been buoyed by hopes that geopolitical tensions in the Middle East may ease, alongside a steady flow of corporate earnings that continue to signal resilience in the US economy.
The S&P 500 and Nasdaq Composite both closed at fresh record highs on Wednesday, reflecting renewed appetite for risk assets.
On Thursday, the Dow Jones Industrial Average rose by around 166 points or 0.35%, while the S&P 500 and Nasdaq 100 also edged higher by around 0.10%.
Geopolitical optimism supports risk appetite
Markets have been particularly sensitive to developments surrounding the Iran conflict, with recent headlines suggesting a potential diplomatic breakthrough. President Donald Trump said in a prerecorded interview that the war is “very close to over,” adding that Tehran wants to “make a deal very badly.”
Additional signals of progress emerged as discussions between Israel and Lebanon were scheduled, a step seen as important for broader negotiations involving Iran. Investors have interpreted these developments as signs that the worst of the conflict may have passed, helping lift equities.
However, market participants remain cautious about the potential for setbacks. “Ongoing negotiations may bring more reversals and contradictory news, keeping trading conditions perilous,” said Lisa Shalett, chief investment officer at Morgan Stanley Wealth Management.
Record highs and broad-based gains
The recent rally has pushed major indices back to — or beyond — previous highs. In Wednesday’s session, the S&P 500 advanced 0.80%, while the Nasdaq Composite gained 1.59%, marking its 11th consecutive day of gains. In contrast, the Dow Jones Industrial Average slipped modestly by 0.15%.
Despite the mixed performance, the broader trend reflects strong investor confidence. The S&P 500 has now erased all losses incurred since the onset of the Iran conflict, underscoring the market’s resilience.
Earnings season and stock movers in focus
Alongside geopolitics, earnings season is playing a key role in shaping market direction. Several companies have reported results that exceeded expectations, particularly within the banking sector, where executives have pointed to continued consumer strength.
PepsiCo shares edged higher after beating quarterly profit estimates, while Travelers edged lower following its results.
Netflix is also due to report after the market close, adding to the week’s lineup of closely watched earnings.
Market activity has also been influenced by individual stock moves. Voyager Technologies gained around 3% after NASA signed an order for the company to conduct a private astronaut mission to the International Space Station, marking its first such selection.
Meanwhile, smaller and previously beaten-down sectors have shown signs of recovery. Tech and software stocks have regained footing, while small-cap stocks are approaching record levels, with the Russell 2000 nearing its intraday high.
Despite the positive momentum, uncertainties remain. Investors continue to monitor geopolitical developments, Federal Reserve leadership dynamics, and the sustainability of the current rally as markets hover near record territory.
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