NEW YORK, April 29, 2026 Dow S&P 500 Nasdaq rise on AI spending hopes U.S. stock markets advanced Thursday as strong earnings from Alphabet and bullish projections for artificial intelligence spending offset mixed performances from other tech giants.
Market Gains and Tech Momentum
The Dow Jones Industrial Average rose 1.3% on Thursday, while the S&P 500 gained 0.4% and the Nasdaq Composite edged up 0.2%. The rally came despite declines earlier in the week from Amazon, Meta, and Microsoft shares following their earnings reports. Alphabet bucked the trend, with its stock climbing after surpassing Wall Street expectations.
Investors appeared buoyed by the combined $725 billion AI spending outlook from four major technology firms this year, signaling continued confidence in the sector's growth potential. The "Magnificent Seven" tech stocks — a group that includes Alphabet, Amazon, Meta, and Microsoft — remain central to market sentiment as their earnings reports shape expectations for AI-driven profitability.
Economic Indicators and Central Bank Decisions
Government spending and investment contributed 0.73 percentage points to U.S. GDP growth in the first quarter, underscoring its role in the economy's 2% expansion. Business investments outpaced consumer spending as a growth driver, while exports of goods and services dragged on performance, resulting in a 1.3 percentage-point loss.
Inflation data showed headline prices rising 0.7% in March and 3.5% year over year, with core readings increasing 0.3% monthly and 3.2% annually. Meanwhile, 189,000 Americans filed initial jobless claims in the week ending April 25, reflecting steady labor market conditions.