Nasdaq, S&P 500 hit record highs on Microsoft, Meta buzz; PCE and Trump tariff jabs temper sentiment

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Wall Street opened higher Thursday, sending the Nasdaq and S&P 500 to record highs, as tech juggernauts Microsoft and Meta Platforms delivered another earnings-fueled jolt. But simmering inflation concerns and fresh tariff threats from US President Donald Trump kept traders on edge.

Nasdaq Composite gained over 1.2% while S&P 500 was flat with about 0.6% gain and Dow Jones rose over 0.2%.

Investors piled into Big Tech after Microsoft revealed Azure’s annual revenue had topped $75 billion, sending shares up 6% and market cap over $4 trillion — joining Nvidia in that elite club. Meta jumped 11.5% after raising its Q3 revenue guidance well above expectations.

Still to report: Apple and Amazon, both scheduled for after-hours.

The personal consumption expenditures (PCE) index, the Federal Reserve’s go-to inflation gauge, came in hotter than expected:

Fresh data showed inflation rose a bit more than expected in June. The PCE index, the Fed’s preferred inflation gauge, increased 2.6% from a year ago, slightly above the 2.5% forecast.

Core PCE, which strips out food and energy, came in at 2.8%, also a touch higher than expected.

Both monthly readings — for headline and core — rose 0.3%, which was in line with estimates.

That’s another wrinkle for Fed policymakers who just opted to hold rates steady. Two members dissented, pushing for a hike, reflecting internal tension around the path ahead.

On his Truth Social account Thursday morning, Donald Trump blasted Fed Chair Jerome Powell, calling him “TOO LATE, TOO STUPID, & TOO POLITICAL” for keeping rates on hold.

“He is costing our Country TRILLIONS… ‘Too Late’ is a TOTAL LOSER,” Trump wrote.

Separately, Trump reignited tariff threats, warning that if no deal is reached by August 1, “massive consequences are coming for countries taking advantage of the U.S.” He hinted at a return to 25 to 50% levies on nations including India, Brazil, and the EU, and said a secondary sanctions framework on China could be explored if oil imports from Russia continue.

These comments came hours before Treasury Secretary Scott Bessent said that a deal with China was within reach, though he offered no timeline or specifics. The current US to China tariff truce expires August 1, with broader penalties looming by August 12.

Moderna announced it will cut 10% of its global workforce by 2025, citing waning demand for Covid vaccines and the need to tighten spending.

Alignment Healthcare surged 20% in extended trade after swinging to a Q2 profit and delivering upbeat guidance.

With Big Tech delivering on earnings but inflation and geopolitics bubbling under the surface, markets are walking a fine line between AI exuberance and policy anxiety.