Thursday was one of those days when everything seems to go right on Wall Street. Stocks rallied across the board, semiconductor names went on a tear, and even the much-maligned regional banks got in on the action. The Nasdaq 100 jumped 1.2%, effectively wiping out Wednesday's losses, while the S&P 500 climbed nearly 1% and flirted with record territory.

The star of the show? Taiwan Semiconductor Manufacturing Co. (TSM), which delivered quarterly results that reminded everyone why they're excited about artificial intelligence in the first place. The company's stronger-than-expected capital spending outlook sent a jolt of enthusiasm through the entire chip supply chain, lifting everything in sight.

Advanced Micro Devices Inc. (AMD) and Dutch chipmaker ASML Holding N.V. (ASML) both surged roughly 6%. But the rally didn't stop there. The chip equipment makers had an even better day, with KLA Corp. (KLAC) soaring 9% and Applied Materials Inc. (AMAT) gaining about 8%. When Taiwan Semiconductor says it's planning to spend big on new manufacturing capacity, the companies that sell them the gear to build those facilities tend to benefit.

Banks Deliver the Goods

The financial sector also had plenty to celebrate. After a somewhat mixed start to earnings season earlier in the week, Goldman Sachs Group Inc. (GS) and Morgan Stanley (MS) delivered results that reassured investors the big banks are doing just fine. Goldman jumped 4% while Morgan Stanley climbed 5%.

Then there's BlackRock Inc. (BLK), which basically reminded everyone why it's the world's largest asset manager. The company reported record quarterly inflows of $341.7 billion and assets under management that reached $14 trillion. Yes, trillion with a T. Shares climbed more than 5% on the news.

The strength in major financial institutions had a spillover effect into regional banks, which have had a rough couple of years. The SPDR S&P Regional Banking ETF (KRE) surged, helping lift small-cap stocks in the process. The Russell 2000 notched record highs for the tenth straight session, pushing its year-to-date gains above 7%. Small caps are having a moment.

Labor Market Still Tight

Economic data added to the positive mood. Initial jobless claims declined by 9,000 to 198,000 in the week ending January 10. That defied forecasts calling for a rise to 215,000 and marked the second-lowest level in two years. The labor market, it seems, remains remarkably resilient heading into the new year.

Meanwhile, commodity markets told a different story. West Texas Intermediate crude slid more than 5% to $58 a barrel, wiping out the week's gains as fears of imminent U.S. intervention in Iran faded. When geopolitical tensions ease, oil tends to fall, and that's exactly what happened Thursday.

Safe-haven assets retreated as well. Gold dropped 0.4% and silver fell 1.9%, reflecting the broader risk-on sentiment. Even Bitcoin (BTC) edged 0.4% lower to around $96,000.

Thursday's Performance In Major US Indices, ETFs

Looking at the major exchange-traded funds, the picture was uniformly positive:

• The Vanguard S&P 500 ETF rose 0.9% to $638.98.
• The SPDR Dow Jones Industrial Average moved 0.7% higher to $495.11.
• The tech-heavy Invesco QQQ Trust Series rose 1.1% to $626.00.
• The iShares Russell 2000 ETF rallied 1.2% to $266.56.
• The Technology Select Sector SPDR Fund outperformed, up 1.6%; the Health Care Select Sector SPDR Fund lagged, down 0.8%.

Russell 1000's Top 5 Gainers

Russell 1000's Top 5 Losers

The broader story here is that investors seem willing to embrace risk again. Strong earnings from financial giants, blowout results from chip manufacturers, and a resilient labor market all point to an economy that's holding up better than many feared. Whether this momentum continues depends on what the rest of earnings season brings, but for now, the bulls are firmly in control.