Wall Street surges on Microsoft earnings beat, semiconductor rebound; Philadelphia Semiconductor Index jumps 8%

Wall Street closed sharply higher Thursday, driven by a blowout earnings report from Microsoft and a broad rebound in semiconductor stocks. The Philadelphia Semiconductor Index surged 8.19% on the day.

The Dow Jones Industrial Average rose 613.92 points, or 1.19%, to close at 52,208.06.

The S&P 500 gained 121.48 points, or 1.66%, to finish at 7,437.63, while the tech-heavy NASDAQ Composite climbed 679.24 points, or 2.78%, to end at 25,122.18.

The NASDAQ's advance snapped a six-session losing streak.

The biggest catalyst for the rally was Microsoft. Shares surged 15.51% after the company posted blowout quarterly results after Thursday's close, adding $450 billion to its market capitalization in a single session — the largest single-day market cap gain for any stock listed on a US exchange in history, according to Reuters.

Microsoft said Thursday that explosive growth in its AI and cloud businesses drove results well above market expectations. The company reported revenue of $90 billion for the fourth quarter of fiscal year 2026 (April–June), up 18% from the same period a year earlier.

That figure far exceeded the $87.62 billion consensus estimate compiled by the London Stock Exchange Group (LSEG). Full-year revenue rose 18% year-on-year to $331.8 billion. Microsoft also said it would hold its capital expenditure outlook at existing levels, reassuring investors.

Meta, by contrast, tumbled 7.95% after raising its capital expenditure guidance Thursday. The company lifted the lower end of its full-year capex range to $130 billion–$145 billion from a prior range of $125 billion–$145 billion, stoking concerns about financial strain.

"Investors are still trying to determine whether the return on investment from massive capital expenditures will ultimately be worth it," said Jed Ellerbroek, portfolio manager at Argent Capital Management.

Semiconductor stocks, which had been under heavy selling pressure, staged a sharp recovery. The Philadelphia Semiconductor Index jumped 8.19%. Micron Technology led the group with a gain of 18.36%, while SanDisk (25.99%), AMD (13.00%) and Intel (11.30%) also posted double-digit advances.

SK Hynix's American depositary receipts surged 17.52%, recovering to their IPO price of $149.