Nasdaq 100 and S&P 500: Nvidia, Tesla, and AppLovin Lead Market Gains as Yields Ease

Stocks Gain as Treasury Yields Ease and Traders Assess Inflation Data

Stocks moved higher on Thursday as investors absorbed hotter-than-expected inflation data while anticipating a potentially softer PCE price index later this month. The Dow Jones Industrial Average added 63 points, or 0.1%, while the S&P 500 advanced 0.3%. The Nasdaq Composite outperformed with a 0.6% gain, driven by strength in major tech stocks.

The producer price index (PPI) for January showed a 0.4% rise, above the expected 0.3%. Core PPI, which excludes food and energy, increased 0.3%, in line with forecasts. Despite the elevated figures, traders took comfort in expectations that the upcoming PCE index—closely watched by the Federal Reserve—may show softer inflation trends.

How Did Tech and Key Stocks Perform?

Technology stocks led the market higher, with Nvidia jumping 2.5% after Hewlett Packard Enterprise (HPE) announced it had shipped its first system using Nvidia’s new Blackwell chip. HPE shares edged 0.4% higher. AppLovin surged 32% after reporting strong earnings, while Tesla gained over 4%.

Cisco Systems climbed more than 5% on better-than-expected earnings and forward guidance. Robinhood rallied 13% after exceeding revenue estimates for the fourth quarter. MGM Resorts saw a 10% jump following a revenue beat, while Dutch Bros soared 24% on strong earnings and upbeat 2025 sales guidance.

Conversely, Trade Desk shares plunged 29% after reporting disappointing revenue and weak guidance. Deere fell 5% as its forward demand outlook disappointed, despite an earnings beat. Barclays slid 4.2% after providing lackluster forward guidance.

Which Sectors Led the Market?

Technology stocks stood out, with the sector gaining 1.22% as investors piled into major AI-related plays. Consumer discretionary stocks also outperformed, rising 1.42%, led by gains in retail and hospitality.

Materials advanced 0.78% as commodity-related stocks benefited from higher demand forecasts. Energy stocks were little changed, rising just 0.1%, while industrials slipped 0.09%. The financial sector barely moved, up just 0.02%, as investors assessed inflation’s impact on rate expectations.

What’s Next for Interest Rates?

Bond yields declined, with the 10-year Treasury yield falling 8 basis points to 4.55%, while the 2-year yield dipped to 4.32%. Traders now expect the Federal Reserve to delay its first rate cut until September, though the probability of a July cut has increased to nearly 50%.

Fed policymakers remain cautious, with Chair Jerome Powell reiterating the need for restrictive policy until inflation moves sustainably toward 2%. However, analysts noted that the latest inflation data suggests underlying PCE inflation could decline to 2.6% or 2.7% year-over-year, down from 2.8% in December.

With the Trade Desk due later this month, markets will closely watch upcoming economic data, including jobless claims and retail sales, for further clues on the Fed’s next steps. Traders are likely to remain focused on Treasury yields and corporate earnings as key market drivers.

Where Is the Market Headed Next?

With inflation data in focus, traders are looking ahead to the PCE price index release later this month, which could provide further clarity on the Federal Reserve’s stance.

Corporate earnings remain a key driver, with major tech names continuing to fuel market gains. If bond yields remain stable and upcoming economic reports support a slowing inflation trend, stocks could see further upside.

However, any surprises in inflation or global trade developments could inject volatility into the market.

More Information in our Economic Calendar.