US Stock Market Sees Rally on Strong Tech Earnings

The US stock market has seen a significant rally in recent sessions, with all three major indexes, Dow, S&P 500, and Nasdaq, on track to close higher this week. This comes despite multiple sessions in the red.

Amazon's quarterly revenue and earnings beat Wall Street expectations, causing its shares to surge over 9% in extended trading hours. Microsoft's stronger-than-expected quarterly results also boosted investor confidence, lifting its stock up more than 15% at close.

The surge in tech stocks has sent AI-related names higher, with Amazon Web Services (AWS) cloud sales jumping 37%. Memory chip stocks Micron Technologies and Sandisk Corp saw significant gains, with their shares surging by over 18% and 25%, respectively.

Jed Ellerbroek, portfolio manager at Argent Capital Management, said Microsoft's strong results put the stock on track to move from 'battleground' to 'trusted AI winner' status. Richard Bernstein, global head of macro and customized investing at Janus Henderson Investors, noted that market leadership is expanding beyond the 'Magnificent 7', with investors rewarding improving fundamentals over hype-driven momentum.

On the geopolitical front, conflict between the US and Iran continued to escalate, with Iran striking US bases in Kuwait, Jordan, and Bahrain. Global oil prices rose due to the tensions, with Brent crude futures expiring in September gaining about 0.4% to $89.38 a barrel.