US close: Chip stocks lift markets amid Trump-Xi summit

(Sharecast News) - Strong corporate earnings and big gains in the chip sector powered US stock markets to new records on Thursday, with the S&P 500 and Nasdaq once again finishing at new peaks.

The S&P 500 gained 0.8% to 7,501.24, while the Nasdaq jumped 0.9% to 26,635.22. The Dow, meanwhile, rose 0.8% to 50,063.46, coming within a whisker of the 50,188 record closing high reached in early February.

Chip stocks in particular were performing well after the US cleared around 10 Chinese companies to buy Nvidia's H200 artificial intelligence chips. Treasury secretary Scott Bessent said the US was now able to engage China on AI because it remains "in the lead", as Washington and Beijing agreed a protocol on best practices for the fast‑advancing technology.

Speaking to CNBC during Donald Trump's two‑day meeting in Beijing with Chinese president Xi Jinping, Bessent said the two countries were preparing to formalise how they would manage AI risks and prevent sensitive models falling into the hands of non‑state actors. The remarks come as markets continue to track geopolitical tensions and the regulatory backdrop for AI - a sector that has been a major driver of US equity valuations in recent months.

Iran also featured prominently in Thursday's meeting between Trump and Xi Jinping, with both sides agreeing that the Strait of Hormuz must remain open.

Investors were also keeping an eye on economic data on Thursday with jobless claims and retail sales figures on tap.

Americans lined up for unemployment benefits at an accelerated pace in the week ended 9 May, according to the Labor Department, with initial claims jumping by 12,000 to 211,000 - above market expectations of 205,000. Continuing jobless claims also increased, rising by 24,000 to 1.78m, slightly below expectations of 1.79m, while the four-week moving average, which aims to strip out week-to-week volatility, increased by 750 to 203,750.

The advance seasonally adjusted insured unemployment rate was 1.2% for the week ended 2 May, an increase of 0.1 percentage point from the previous week's downwardly revised rate.

US retail sales rose 0.5% month‑on‑month in April, according to the Census Bureau, matching expectations but easing from a downwardly revised 1.6% increase in March. Sales jumped 2.8% at gasoline stations as fuel prices continued to climb amid the US and Israel's conflict with Iran. Excluding gas stations, retail sales were up 0.3%.

The control group - which excludes food services, auto dealers, building materials and gasoline stations and feeds directly into GDP calculations - rose 0.5% in April, following a 0.8% gain in March and coming in slightly ahead of forecasts for a 0.4% increase.

Nvidia and Cisco jump

Shares in Nvidia surged over 4% after the news that Alibaba, Tencent, ByteDance and JD.com were among the Chinese outfits cleared to buy its H200 AI chips. No deliveries had yet been made as the deal remained caught between Washington's export controls and Beijing's efforts to reduce reliance on foreign technology, according to Reuters.

"There's a lot riding on Donald Trump's visit to China, but already the presence of Nvidia's boss Jensen Huang is raising speculation about the kind of deals that could be forthcoming," said AJ Bell's head of financial analysis Danni Hewson.

"Nvidia is already flying high, but the ability to expand its footprint and serve more customers in China's lucrative market would help lift sales higher. Investors appear to be betting this trip is going to deliver more than just photo ops as shares in the chip giant have continued to climb."

Nvidia's stock was also helped higher by UBS which raised its target for the stock from $245 to $275, keeping a 'buy' rating.

Others in the sector, including Broadcom, AMD and US-listed shares of TSMC also finished the day with impressive gains.

Telecoms and networking tech giant Cisco Systems jumped after announcing it is cutting its workforce by nearly 4,000 as part of its so-called 'Path Forward' restructuring plan costing $1bn to compete in the AI era. The restructuring plan, which will see Cisco shed nearly 5% of its total employee base, will allow it to invest in key growth opportunities including silicon, optics, security and AI.

American energy major Chevron gained after selling all of its downstream operations across South East Asia and Australia to Eneos for a total of $2.2bn, as it continues to streamline its business.

Comcast spin-off Versant was also a high riser after the media group beat expectations with its first-quarter revenues and profits, helped by strong growth in its Platforms business.

Buy now, pay later giant Klarna jumped after posting first‑quarter revenue and operating profits that came in ahead of expectations, with sales jumping 44% to $1bn on strong US growth.

Lastly, outdoor goods company Yeti rallied on the back of stronger‑than‑expected first quarter numbers, with the group reporting adjusted earnings of $0.26 per share and an 8% rise in revenue to $380.4m, prompting it to hike the lower end of its full‑year guidance.

Dow Jones - Risers

Cisco Systems Inc. (CSCO) $115.53 15.54%

Caterpillar Inc. (CAT) $920.22 1.99%

Microsoft Corp. (MSFT) $409.43 1.87%

International Business Machines Corporation (CDI) (IBM) $218.37 1.74%

Goldman Sachs Group Inc. (GS) $968.96 1.42%

Travelers Company Inc. (TRV) $298.29 1.11%

Salesforce.Com Inc. (CRM) $167.58 1.05%

American Express Co. (AXP) $312.77 1.02%

Visa Inc. (V) $322.52 0.69%

Home Depot Inc. (HD) $304.35 0.59%

Dow Jones - Fallers

Intel Corp. (INTC) $115.93 -6.13%

Boeing Co. (BA) $229.21 -4.73%

3M Co. (MMM) $145.12 -1.35%

Nike Inc. (NKE) $42.02 -0.76%

Unitedhealth Group Inc. (UNH) $399.09 -0.52%

Verizon Communications Inc. (VZ) $47.06 -0.32%

McDonald's Corp. (MCD) $274.97 -0.26%

Dow Chemical Co. (DOW) $38.78 -0.15%

JP Morgan Chase & Co. (JPM) $299.91 -0.11%

Amgen Inc. (AMGN) $336.23 -0.11%

S&P 500 - Risers

Cisco Systems Inc. (CSCO) $115.53 15.54%

CenturyLink Inc. (LUMN) $10.34 10.00%

Take-Two Interactive Software Inc. (TTWO) $242.41 8.09%

J.B. Hunt Transport Services Inc. (JBHT) $254.66 7.46%

Broadcom Inc. (AVGO) $439.79 7.31%

Ford Motor Co. (F) $14.48 6.71%

Fortinet Inc. (FTNT) $121.86 6.56%

FMC Corp. (FMC) $13.56 6.52%

Hewlett Packard Enterprise (HPE) $34.13 6.42%

Aptiv PLC (APTV) $57.56 6.18%

S&P 500 - Fallers

Coterra Energy Inc. (CTRA) $32.56 -8.62%

Intel Corp. (INTC) $115.93 -6.13%

CBRE Group Inc (CBRE) $132.45 -5.83%

QUALCOMM Inc. (QCOM) $200.08 -5.72%

Biogen Inc (BIIB) $191.37 -5.21%

Verisk Analytics Inc. (VRSK) $156.84 -4.91%

Albemarle Corp. (ALB) $191.10 -4.90%

Boeing Co. (BA) $229.21 -4.73%

Sba Communications Corp. (SBAC) $201.21 -4.73%

Jack Henry & Associates Inc. (JKHY) $134.03 -4.60%

Nasdaq 100 - Risers

Cisco Systems Inc. (CSCO) $115.53 15.54%

Take-Two Interactive Software Inc. (TTWO) $242.41 8.09%

J.B. Hunt Transport Services Inc. (JBHT) $254.66 7.46%

Broadcom Inc. (AVGO) $439.79 7.31%

Mercadolibre Inc. (MELI) $1,607.37 5.05%

Nvidia Corp. (NVDA) $235.74 4.66%

Check Point Software Technologies Ltd. (CHKP) $120.25 4.35%

Henry Schein Inc. (HSIC) $72.61 4.25%

KLA-Tencor Corp. (KLAC) $1,892.94 3.89%

Asml Holdings N.V. (ASML) $1,584.51 3.37%

Nasdaq 100 - Fallers

Qvc Group Inc Series A (QVCGA) $0.34 -13.49%

Intel Corp. (INTC) $115.93 -6.13%

QUALCOMM Inc. (QCOM) $200.08 -5.72%

Biogen Inc (BIIB) $191.37 -5.21%

Verisk Analytics Inc. (VRSK) $156.84 -4.91%

DENTSPLY Sirona Inc. (XRAY) $10.41 -4.32%

Trip.com Group Limited (TCOM) $50.28 -3.86%

T-Mobile Us, Inc. (TMUS) $188.19 -3.23%

Paychex Inc. (PAYX) $88.83 -2.86%

Micron Technology Inc. (MU) $776.01 -2.40%