U.S. equity futures surged Thursday, marking a strong shift in market sentiment, driven by two major catalysts: robust earnings from tech heavyweights and emerging signs that the Trump administration is stepping back from its most aggressive tariff threats. Investors embraced the dual relief, pushing futures higher across all three major indices and signaling a risk-on mood for the session ahead.

Big Tech Takes Center Stage

At the heart of the rally was Microsoft, which saw its stock soar nearly 9% after it comfortably beat Wall Street’s estimates on both earnings and revenue. The company’s Azure cloud division continues to be the engine of its growth, and its forward-looking guidance added further confidence to the bullish outlook. Microsoft’s momentum reflects the broader strength in cloud computing and AI-driven services that continue to dominate tech valuations.

Another standout was Meta Platforms, which jumped 6% after delivering first-quarter earnings of $6.43 per share on revenue of $42.31 billion—well ahead of expectations. Investors were particularly enthusiastic about reports that Meta plans to increase its AI-related spending, a move seen as a long-term growth driver. That announcement sparked a broader rally in semiconductor stocks, with Nvidia, Marvell Technology, Broadcom, and Advanced Micro Devices all moving higher in sympathy. The market interpreted Meta’s aggressive AI push as a rising tide for chipmakers supporting next-generation computing infrastructure.

On the flip side, Qualcomm was a notable underperformer. Despite reporting better-than-expected fiscal second-quarter earnings and revenue, and strong year-over-year chip sales growth, the stock dropped 5%. The reason: a slightly softer revenue forecast for the current quarter. For investors riding high on earnings beats, Qualcomm’s cautious outlook was enough to take some of the wind out of its sails.

Strength Beyond Tech

The rally wasn’t limited to Silicon Valley. CVS Health surged 8% after posting a decisive beat on both top and bottom lines, reporting adjusted earnings of $2.25 per share versus expectations of $1.70. Revenue also topped forecasts, coming in at $94.59 billion. The company further buoyed investor confidence by raising its full-year earnings guidance, signaling resilience in the face of broader healthcare cost pressures.

General Motors managed to rise 3%, even after it revised its 2025 forecast downward. The automaker cited escalating trade tensions and tariffs as a major headwind, yet its results were solid enough to keep buyers interested. GM now expects full-year adjusted earnings before interest and taxes in the range of $10 billion to $12.5 billion—lower than the previously projected $13.7 billion to $15.7 billion. The stock’s gain suggests investors were more relieved by the broader market context than dismayed by the lowered outlook.

Amazon also contributed to the upward trend, rising 4% after revealing a $4 billion investment plan aimed at expanding its rural delivery network by 2026. This strategic move is being seen as a long-term play to improve logistics efficiency and reach under-served regions, further solidifying Amazon’s dominance in U.S. e-commerce.

Robinhood added to the positive sentiment, climbing 4% after beating first-quarter estimates with earnings of 37 cents per share on revenue of $927 million. The beat, albeit modest, reassured investors that the platform continues to attract users and maintain trading activity despite a more subdued retail trading environment compared to recent years.

Pockets of Weakness

Not every stock joined the rally. McDonald’s slipped 1% after posting its largest decline in U.S. same-store sales since 2020. Revenue came in below expectations at $5.96 billion, highlighting challenges in consumer discretionary spending, particularly in fast food. A 3.6% year-over-year drop in U.S. same-store sales underscores that even strong brands are not immune to changing consumer behavior.

Eli Lilly fell more than 4% despite a solid earnings and revenue beat. The drag came from a cut in full-year profit guidance due to charges related to a cancer treatment acquisition. While demand for its weight loss and diabetes drugs continues to soar, the lowered profit outlook introduced some near-term uncertainty.

Meanwhile, Tesla shares edged up nearly 1% in a volatile session following the company’s denial of a report that its board was seeking a replacement for CEO Elon Musk. The stock had dipped as much as 3% in overnight trading, but the denial was enough to stem the losses and slightly reverse the narrative—at least temporarily.

Finally, Apple declined 2% after a judge ruled that it had willfully violated a 2021 court order stemming from the Epic Games litigation. The court held the company in contempt, stating Apple misrepresented its compliance with the earlier ruling related to App Store practices. The legal setback comes at a time when regulatory scrutiny of Big Tech remains elevated.

Outlook: A Market on Edge but Optimistic

Thursday’s session reflected a market walking a tightrope between optimism and caution. Strong earnings from tech giants and solid performances in healthcare and retail sectors are encouraging signs for bulls. However, lingering macroeconomic uncertainties—from trade policy shifts to regulatory challenges—mean investors will need to stay nimble.

Still, with earnings season in full swing and AI-related optimism spreading across sectors, market participants seem content, for now, to ride the wave of positive sentiment.