U.S. stocks bounced back on Thursday, recovering from the previous session’s sell-off as a drop in oil prices reassured investors that inflation can stay contained even after the Federal Reserve raised interest rates for the first time since 2023. All three major indexes closed higher, with technology and chip stocks leading the advance. The rally came one day after the central bank lifted its benchmark rate and signaled a cautious path ahead, and traders appeared relieved that cheaper energy could take some pressure off consumer prices.
What Moved Markets
The Nasdaq Composite led the gains, climbing 439.88 points, or 1.69%, to close at 26,418.30 as technology and semiconductor names surged. The S&P 500 added 85.95 points, or 1.14%, to finish at 7,637.76. The Dow Jones Industrial Average rose 317.95 points, or 0.62%, to end at 51,779.85.
The driving force was a pullback in oil prices, which helped calm worries about inflation just as the Fed begins a new tightening cycle. On Wednesday, the central bank raised its key rate by a quarter point to a target range of 3.75% to 4%, its first increase in more than two years. Policymakers projected only one additional hike this year, which investors read as a measured pace rather than an aggressive campaign. Treasury yields eased modestly, with the two-year note slipping to about 4.71% after touching a multi-year high in the prior session. A closely watched gauge of chipmakers jumped roughly 3%, reflecting renewed appetite for artificial intelligence and growth stocks.
Notable Movers
Nebius Group (NBIS) rallied more than 9% after the AI infrastructure company told customers it would raise prices across its GPU cloud services by roughly 20% starting in October. The move signaled strong demand for AI computing power and a stronger pricing outlook for the company.
Generac Holdings (GNRC) surged after disclosing a partnership with Amazon that includes a warrant allowing the tech giant to buy about 1.69 million shares, or close to 3% of the company, at an exercise price near $200.93.
GMS Inc (GMS) jumped about 21% to around $98 per share following a takeover proposal from building-products distributor QXO, one of the day’s most notable deal-related moves.
Among earnings, Darden Restaurants (DRI) reported first-quarter results in line with expectations, posting earnings of $2.05 per share. Homebuilder Lennar (LEN) was set to report after the close, with investors watching for signs of how rising rates are affecting housing demand.
Looking Ahead
With the Fed’s rate decision now behind them, investors will turn their attention to incoming economic data for clues on whether inflation is cooling enough to keep the central bank on its projected path of just one more hike this year. Oil prices remain a key variable, since further declines could ease price pressures while a rebound might revive inflation concerns. Earnings from housing-sensitive names like Lennar, along with next week’s economic reports, should help shape expectations for the rest of the year. For now, the market appears willing to look past higher borrowing costs as long as inflation stays in check.