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Financial Markets 04/30 09:33
NEW YORK (AP) -- Oil prices whipsawed on Thursday and surged toward their
highest levels since the war with Iran began, only for the leaps to quickly
vanish. The U.S. stock market, meanwhile, is gliding following more strong
profit reports from big companies like Alphabet.
The S&P 500 rose 0.1% and is a bit below its all-time high set earlier this
week, as companies continue to deliver fatter profits for the start of 2026
than analysts expected despite high oil prices and uncertainty about the
economy. The Dow Jones Industrial Average was up 413 points, or 0.8%, as of 10
a.m. Eastern time, and the Nasdaq composite was 0.3% lower.
Alphabet led the way and rose 5.8% after the owner of Google and YouTube
reported profit for the latest quarter that almost doubled analysts'
expectations. Investments in artificial intelligence "are lighting up every
part of the business," CEO Sundar Pichai said.
The steadiness on Wall Street followed manic swings in the oil market, where
prices surged overnight on worries that the Iran war will affect the flow of
crude for a long time. Iran has closed the Strait of Hormuz to oil tankers,
keeping them pent up in the Persian Gulf and away from customers worldwide,
while a U.S. Navy blockade is preventing Iran from selling its own oil.
Traders are always buying and selling contracts for different kinds of oil,
going out for many months. In the most actively traded part of the market for
Brent crude, the international standard, the price got as high as $114.70
overnight for a barrel of Brent to be delivered in July. It then regressed to
$109.80, down 0.6%, which is still well above the roughly $70 per barrel that
Brent was selling for before the war.
So far during the war, the peak price for the most actively traded Brent
contract is $119.50, which was set last month.
In a less actively traded corner of the Brent market, the price for a barrel
to be delivered in June briefly went above $126 overnight before pulling back
toward $114.
That easing, along with the continuing flood of better-than-expected profit
reports from U.S. companies, helped to keep Wall Street stable near its records.
Caterpillar, Eli Lilly, O'Reilly Automotive and Royal Caribbean all rallied
more than 6% after delivering profits for the latest quarter that topped
analysts' expectations. That's crucial for investors because stock prices tend
to follow the track of corporate profits over the long term.
Still, a better-than-expected result isn't always enough to boost a stock's
price if it's already shot much higher.
Meta Platforms tumbled 9.9% even though the company behind Facebook and
Instagram made more profit last quarter than expected. Investors focused more
on Meta's increased forecast for how much it will spend on data centers and
other investments this year as it builds out its AI capabilities, up to a range
of $125 billion to $145 billion.
Doubts are still high among some investors about whether all the AI spending
by Meta and other companies will produce enough profit and productivity to make
it worth it.
Microsoft fell 4.5% after it likewise raised its forecast for investments
and other capital spending. But analysts also said accelerating trends at its
Azure business were encouraging.
Amazon slid 0.8% after blowing past analysts' expectations for earnings in
the latest quarter.
In the bond market, Treasury yields eased after oil prices gave up their big
overnight gains. Reports also suggested that U.S. economic growth accelerated
by less in the first three months of the year than economists expected, while a
measure of inflation worsened in March by about as much as expected.
A separate report said that fewer U.S. workers applied for unemployment
benefits last week in an indication of fewer layoffs even though companies are
announcing large cuts to workforces.
The yield on the 10-year Treasury eased to 4.38% from 4.42% late Wednesday.
In stock markets abroad, indexes were mixed.
London's FTSE 100 jumped 1.3% after the Bank of England kept its main
interest rate on hold.
Germany's DAX returned 0.7%, and France's CAC 40 slipped 0.2% after the
European Central Bank also held its own interest rates steady. That followed
similar decisions by the U.S. Federal Reserve on Wednesday and the Bank of
Japan on Tuesday to keep their rates unchanged.
Hong Kong's Hang Seng lost 1.3%, while stocks added 0.1% in Shanghai after a
report said China's factory activity slowed slightly in April but remained in
expansion territory for the second month.
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AP Business Writers Chan Ho-him and Matt Ott contributed to this report.
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