U.S. equity markets finished Thursday on a positive note, with all major indexes recording gains by the closing bell. The rally was largely driven by strong earnings reports from the technology sector and a notable surge in small-cap stocks, signaling a broad-based investor confidence despite mixed economic signals and specific sector weaknesses.
The Russell 2000, which tracks smaller companies, emerged as the day's top performer with a 1.28% increase. Following behind were the Nasdaq Composite, which climbed 0.94%, the S&P 500 with a 0.58% gain, and the Dow Jones Industrial Average, which rose by 0.31%.
Key Takeaways
- All major U.S. stock indexes closed in positive territory, with the Russell 2000 leading the gains.
- Intel reported a strong quarter with a $4.1 billion profit, boosted by high demand for AI technology, sending its stock up 8%.
- Ford's stock rose 2.6% after a positive underlying business performance report, though its 2025 guidance was lowered.
- Healthcare insurance stocks, particularly Molina Healthcare, experienced a sharp decline after a guidance cut raised concerns about industry-wide costs.
- Quantum computing stocks saw significant volatility following conflicting reports about potential government investment.
Tech Sector Shines on Strong Earnings
The technology sector provided much of the upward momentum for the market, with semiconductor giant Intel delivering a standout performance. The company's stock surged 8% in after-hours trading after it reported quarterly results that surpassed analyst expectations.
Intel announced a quarterly profit of $4.1 billion, a figure significantly bolstered by the escalating demand for its artificial intelligence (AI) related products. This strong showing suggests that the company's strategic investments in AI are beginning to yield substantial returns, helping to lift investor sentiment across the broader tech landscape.
By the Numbers: Market Closing
- Russell 2000: +1.28%
- Nasdaq Composite: +0.94%
- S&P 500: +0.58%
- Dow Jones Industrial Average: +0.31%
Automotive and Industrials Present a Mixed Picture
In the automotive sector, Ford Motor Company saw its shares climb 2.6% after the company indicated that its core business operations were performing at the high end of its previous full-year guidance. This positive news, however, was tempered by a significant headwind.
Ford stated that it faced a $1 billion impact from tariffs and was forced to lower its 2025 guidance due to a fire at a key supplier. The market's positive reaction suggests investors are focusing on the strength of the underlying business rather than the temporary setbacks.
Meanwhile, the industrial sector offered a more varied outlook. Railroad operator Norfolk Southern saw its stock dip slightly by 0.29% after narrowly missing both earnings and revenue estimates. The company reported adjusted earnings per share of $3.30 and revenue of $3.1 billion, just shy of expectations. It also noted some revenue challenges stemming from competitor actions following its merger activities with Union Pacific.
Corporate Restructuring and Layoffs
Several major companies announced plans for workforce reductions and restructuring. Target revealed plans to cut 1,800 corporate roles, representing about 8% of its corporate staff. Similarly, Applied Materials will take charges of $160-180 million as it moves to lay off 4% of its workforce. In the electric vehicle space, Rivian also announced it would cut 4% of its employees, or over 600 jobs, in an ongoing cost-saving effort.
Sector Spotlight: Healthcare and Quantum Computing
Healthcare Stocks Under Pressure
While the broader market trended upward, the healthcare insurance sector faced a significant sell-off. The downturn was triggered by Molina Healthcare, which saw its stock plummet by 20.1% after it slashed its financial guidance and warned of higher-than-expected healthcare utilization costs.
This news had a ripple effect across the industry, with shares of other insurers also falling as investors grew concerned about rising costs impacting profitability sector-wide. The sharp decline in stocks like Molina and Centene Corp. made them some of the day's biggest losers.
Volatility in Quantum Computing
Quantum computing stocks experienced a day of wild swings amid conflicting reports regarding potential government investment. An initial report suggested the White House was considering taking stakes in publicly traded quantum firms, causing a speculative surge in stocks like D-Wave Quantum, IonQ, and Rigetti Computing.
However, a subsequent report from a White House source denied any interest in such investments, leading to a partial sell-off. Despite the reversal, many of these stocks remained up by double-digit percentages for the day, highlighting the intense retail investor interest in this nascent and largely unprofitable technology sector. The activity contributed to the strong performance of the Russell 2000 index, where many of these smaller tech firms are listed.
Other Notable Market Movers
Beyond the major headlines, several other companies saw significant stock price movements based on their earnings reports and corporate announcements.
On the upside, Carpenter Technology was a top performer, with its stock soaring 24.7%. Las Vegas Sands also had a strong day, gaining 12.4% after a positive earnings report.
On the downside, Deckers Outdoor, the parent company of UGG and HOKA, saw its stock fall 8% after its revenue guidance for the upcoming period fell short of market expectations, even though its latest earnings and revenue beat estimates. Integer Holdings was the day's biggest loser, with its stock dropping 32%.
Housing Market Holds Steady
Economic data released today showed that the U.S. housing market remains stable. Existing home sales for September were reported at 4.06 million, a 1.5% increase month-over-month. This figure has remained consistently near the 4 million mark in recent months, supported by declining mortgage rates, which recently hit a three-year low of 6.17% according to Redfin.
In other news, President Donald Trump announced that he has pardoned Binance founder Changpeng Zhao, who was previously convicted of violating anti-money laundering laws. Following the pardon, reports suggest Zhao will now support the Trump family's cryptocurrency ventures.
