The S&P 500 closed higher, lifted by a rally in Oracle shares and a favorable inflation report. The benchmark index climbed 0.38% to close at 6,045.26, sitting less than 2% off its record high. The Nasdaq Composite gained 0.24% to end at 19,662.48, while the Dow Jones Industrial Average added 101.85 points, or 0.24%, to settle at 42,967.62.
Shares of Oracle surged 13% after the company reported strong earnings and forecasted significant growth in its cloud infrastructure revenue, driven by demand in AI. CEO Safra Catz stated that cloud infrastructure revenue is expected to increase by more than 70% in fiscal year 2026, compared to a 52% growth in the recent quarter. Oracle’s performance provided a significant lift to the tech sector, contributing to the overall market gains.
In contrast, a Dow component saw a nearly 5% decline following an incident involving an Air India Dreamliner 787 with 242 passengers on board. Economic data released on Thursday also contributed to the positive market sentiment. The May Producer Price Index, a measure of final demand prices in the U.S. economy, rose by just 0.1% after a 0.2% decrease in April.
This was lower than the 0.2% increase economists had predicted, easing concerns about inflation. Bond yields eased following the report. Despite the market’s positive performance, President Donald Trump’s unilateral tariff threat continued to keep gains in check.
Trump said he would be willing to extend the July 8 deadline for trade talks with various countries before higher U.S. tariffs take effect, although he believes such extensions may not be necessary given the progress in the negotiations.
oracle boosts s&p 500 gains
Trump cited ongoing discussions with China, Japan, South Korea, and the EU, with a potential easing of restrictions on rare earth metals and foreign students as areas of agreement.
Tom Hainlin, senior investment strategist at U.S. Bank Asset Management Group, remarked that market direction and reaching new highs still hinge on a resolution of tariff negotiations, particularly given the ongoing trade talks between the U.S. and China. In other news, shares of Novo Nordisk rose over 2%, driven by hopes for its next-generation obesity drug, amycretin. This new drug is set for late-stage trials and is being developed both as a pill and an injection.
Despite being down nearly 6% year-to-date, Novo Nordisk’s stock has gained over 19% in the past month. Amycretin targets both the gut hormone GLP-1, like its predecessor Wegovy, and the hunger-suppressing pancreatic hormone amylin. Investor Nancy Tengler advised staying long on Oracle, emphasizing the company’s strong cloud business and its acquisition of health tech company Cerner for $28.3 billion.
She noted the potential for significant growth in healthcare applications of AI. However, analysis from BCA Research indicated that ongoing de-escalation in U.S.-China trade tensions might not drive stocks to new highs. The muted market reaction to recent trade deals suggests that markets are highly priced with limited upside, even if a recession is avoided.
Goldman Sachs economists have reduced the risk of a U.S. recession in the next year to 30% from a previous 35%, citing lesser-than-expected economic drag from tariffs. The firm forecasts a 1.25% year-over-year GDP growth for 2025 and peak unemployment at 4.4%, with a Federal Reserve interest rate cut anticipated in December 202,5 followed by two more in 2026. Dan Niles, founder of Niles Investment Management, warned of potential market challenges later this year.
He pointed out that imports surged by 41% in Q1, which could indicate that earlier demand might have been pulled forward, potentially leading to weaker performance in subsequent quarters.
