Snowflake Earnings Send Software Stocks Soaring

Stocks in several software companies surged on Thursday after Snowflake reported earnings and increased its forward outlook, boosting investor sentiment across the enterprise software industry. The upbeat report from Snowflake sent shockwaves through the market, with Treasury yields falling as a result of Fed Governor Christopher Waller's comments supporting steady interest rates.

The decline in Treasury yields had a positive effect on software valuations, which are heavily based on cash flows expected years into the future. With lower yields reducing the discount rate applied to those earnings, investors reassigned more value to the group today.

Among the companies impacted were Datadog (NASDAQ:DDOG), Amplitude (NASDAQ:AMPL), Zscaler (NASDAQ:ZS), DocuSign (NASDAQ:DOCU), and Salesforce (NYSE:CRM). These stocks jumped 2.7%, 2.6%, 2.4%, 2%, and 3.5%, respectively.

Salesforce's share price is somewhat volatile, with 14 moves greater than 5% over the last year. The company reported second-quarter financial results that exceeded expectations and raised its full-year earnings guidance seven days ago, resulting in an 18.9% gain in the stock.