Record Highs and AI Euphoria: Snowflake's 37% Surge Leads the Charge
MarketDash
U.S. stocks hit new records as a US-Iran ceasefire deal eases inflation fears, while Snowflake's blowout earnings ignite a rally in AI software stocks.
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U.S. stocks hit record highs Thursday after reports that Washington and Tehran agreed to a 60-day ceasefire extension and phased resumption of Strait of Hormuz tanker traffic. The S&P 500 advanced 0.5% to a record 7,557.85, while the Dow Jones Industrial Average added 32 points, or 0.1%, to 50,676. The Nasdaq 100 climbed 0.4% to a record 30,089.
Within Magnificent Seven stocks, Microsoft (MSFT) jumped 2.9%, while Nvidia (NVDA) edged 0.3% higher – on track to snap four straight sessions of losses. The small-cap Russell 2000 rallied 0.6% to 2,937, the strongest performance among major U.S. benchmarks.
April PCE Report Delivered Mixed Read For Fed
Headline Personal Consumption Expenditure (PCE) inflation accelerated to 3.8% year-over-year – the hottest since early 2023 – with the monthly print up 0.4%, but core PCE rose just 0.2% on the month and 3.3% year-over-year, broadly in line with estimates. Real personal spending grew just 0.1%, personal income was essentially flat, and first-quarter GDP was revised lower by 0.4 percentage points to 1.6% on softer investment, painting a picture of a consumer that is no longer outrunning prices.
The mixed macro print did little to soften the Fed's hawkish chorus. St. Louis Fed President Alberto Musalem said rate hikes remain on the table if price pressures fail to converge back to the 2% target, echoing similar warnings from Fed Vice Chair Philip Jefferson and Minneapolis Fed President Neel Kashkari.
AI Software Spending Spree Lights Up Records Board
The Technology Select Sector SPDR Fund (XLK) led S&P 500 sectors with a 1.4% advance, fueled by a wave of AI software and infrastructure buying after Snowflake Inc. (SNOW)'s blowout print. The data-cloud company rocketed 37% on its best session ever, after smashing both earnings and revenue estimates and unveiling a $6 billion five-year commitment to expand its Amazon (AMZN)'s AWS infrastructure partnership. Wall Street analysts flagged an "inflection" quarter for Snowflake, on the back of rising AI-cloud orders.
In retail, Best Buy Co. Inc. (BBY) surged 18% after Q1 sales of $8.94 billion topped the $8.82 billion consensus, comparable sales rose 2% versus a 0.7% decline a year earlier, and management reiterated $6.45 in full-year adjusted EPS. Dollar Tree Inc. (DLTR) climbed 17% after Q1 adjusted EPS of $1.74 beat the $1.55 consensus and the discounter lifted FY2026 adjusted EPS guidance to $6.70-$7.10.
Life-sciences leader Agilent Technologies Inc. (A) jumped 17% after fiscal Q2 revenue of $1.83 billion and non-GAAP EPS of $1.49 beat estimates, with management raising the guidance on revenue. Axon Enterprise Inc. (AXON) rallied 13% after raising full-year revenue growth guidance to 30%-32% on a 700% year-over-year jump in AI-related product revenue and the disclosure of a $153 million long-term public safety contract.
On the downside, Everpure Inc. (P) tumbled 12% as the data storage firm's beat-and-raise was overshadowed by Q2 revenue guidance of $553 million, well below Wall Street's projections. Synopsys Inc. (SNPS) slid 8.3% after fiscal Q2 revenue of $2.28 billion missed the $2.30 billion consensus by roughly $20 million despite a beat on EPS, with investors looking for a sharper guidance hike. Salesforce Inc. (CRM) dipped roughly 2% after the company beat on sales and EPS but offered Q2 revenue guidance slightly below consensus.
