Google parent company Alphabet delivered excellent first-quarter results, boosting the entire technology sector. Simultaneously, trade tensions between the US and China have eased, giving investors another reason for optimism. The markets are now experiencing a positive sentiment, with major indices on track for a profitable week as investors focus on technology and AI stocks.
Futures Rise on Positive News
US stock index futures rose on Friday as investors piled into technology and artificial intelligence stocks following strong earnings from Alphabet. The positive mood was further enhanced by the de-escalation of trade tensions between the US and China.
At 05:20 ET (09:20 GMT), Dow Jones Futures gained 12 points (0.1%), S&P 500 Futures rose 18 points (0.3%), and Nasdaq 100 Futures climbed 60 points (0.3%).
The main Wall Street indices closed Thursday with solid gains, securing a three-day winning streak and heading toward a positive week:
- S&P 500 has gained nearly 4% since the beginning of the week
- Dow Jones Industrial Average is up more than 2%
- NASDAQ Composite has risen more than 5%
China Eases Trade Tensions
Market sentiment received a further boost on Friday following a report that China is considering exempting certain US products from retaliatory tariffs and has asked businesses to identify goods that could be eligible.
According to a source close to the matter, cited by Reuters, a taskforce from China’s Ministry of Commerce is compiling a list of items that might be exempted and is asking companies to submit their own requests.
Investors were also encouraged by indications that US President Donald Trump’s administration may be softening its stance toward Beijing. Trump has made China a central target of his aggressive tariff agenda, raising levies on the world’s second-largest economy to at least 145%.
Alphabet Excels and Drives the “Magnificent 7”
Alphabet shares rallied strongly after reporting much better than expected first-quarter results and announcing a $70 billion stock buyback. The company also reaffirmed its ambitious AI development plans, strengthening confidence that AI-driven demand for chips and data centers will persist.
Analysts noted that Alphabet’s performance exceeded expectations and that the company’s AI products are gaining significant traction. This positive sentiment was echoed by Citigroup analyst Ronald Josey, who highlighted that the search and cloud results are promising for other tech giants such as Meta and Amazon.
The “Magnificent 7” group of leading tech stocks also experienced movement following Alphabet’s report:
- Meta saw a 4.2% increase
- Amazon experienced a 1.8% rise
- Tesla’s stocks went up by 1.7%
- Nvidia’s shares increased by 1.3%
- Microsoft and Apple’s shares remained relatively unchanged
Earnings Season Continues
A barrage of company earnings are due in the coming weeks, including from tech giants Microsoft and Apple. The focus is likely to be more on guidance for the current year, especially in the face of heightened economic uncertainty.
Other key companies like AutoNation, Colgate-Palmolive, AbbVie, Phillips 66, and Centene are set to report their quarterly results on Friday before markets open.
Intel, on the other hand, reported weaker results, with its shares sliding 5% as weak guidance offset better-than-expected earnings. The struggling chipmaker also flagged heightened concerns over macroeconomic headwinds from a trade war.
Oil Heads for Weekly Drop
Oil prices edged higher, but the market was headed for a weekly decline amid concerns about oversupply from the Organization of the Petroleum Exporting Countries (OPEC).
