Dow rises 314 points as earnings offset oil, inflation worries

US stocks opened higher on Thursday as investors balanced strong corporate earnings against rising geopolitical tensions in the Middle East and persistent inflation concerns.

The Dow Jones Industrial Average rose about 0.64% or 314 points, while the S&P 500 gained roughly 0.22%. Nasdaq 100 advanced around 0.06%.

Earnings strength supports market sentiment

Investor sentiment found support in a fresh batch of corporate earnings, particularly from large-cap technology and industrial companies.

Shares of Alphabet Inc. jumped 6.4% after the company reported a record quarter for its cloud unit. Amazon was up 0.6% after exceeding expectations for cloud sales.

Among industrials, Caterpillar gained between 7.4% after posting stronger-than-expected first-quarter profit.

Eli Lilly shares rose 6.2% after the drugmaker raised its annual profit forecast, citing sustained demand for its weight-loss treatments.

However, gains were capped by declines in other major technology names.

Meta Platforms fell as much as 9.8% after issuing capital expenditure guidance that weighed on sentiment, alongside disappointing user growth.

Microsoft slipped 3% after warning that spending could reach $190 billion due to rising memory costs.

Geopolitical tensions and oil volatility in focus

Markets remained sensitive to developments in the Middle East, particularly the escalating conflict involving the United States and Iran.

Oil prices, which had surged sharply in recent sessions, showed some signs of easing on Thursday.

Brent crude futures fell about 3% but remained elevated above $110 per barrel, after hitting their highest levels in nearly four years.

West Texas Intermediate crude dropped roughly 2%, trading above $104 per barrel.

The recent volatility in oil markets has been driven by concerns about prolonged supply disruptions.

A report indicated that US President Donald Trump was set to receive a briefing on potential military action against Iran, adding to fears of further escalation.

Analysts noted that earlier optimism around diplomatic solutions had begun to fade.

Fed outlook and economic signals add complexity

Investors were also digesting signals from the Federal Reserve, which voted to hold interest rates steady in the 3.5% to 3.75% range.

The decision, though widely expected, revealed some division among policymakers, with multiple officials indicating that inflation remains too high to justify a shift toward rate cuts.

Comments from Fed Chair Jerome Powell underscored the cautious stance. Market participants are increasingly reassessing expectations for monetary easing, particularly as inflationary pressures persist.

Economic data released Thursday showed that US growth picked up in the first quarter, supported by a rebound in government spending.

However, the improvement may prove temporary as higher gasoline prices linked to geopolitical tensions weigh on household budgets.

Despite these uncertainties, Wall Street is on track to close April on a strong note.

The S&P 500 is poised for a 9.3% monthly gain, while the Nasdaq is set to rise 14.3%, marking its best performance since 2020. 

The Dow is also heading for a 5.4% advance, its strongest showing since November 2024.