Nasdaq 100: Nvidia Earnings Spark Rally, But Stock Market Braces for Tariff Fallout

S&P 500, Nasdaq Climb as Nvidia Soars; Traders Monitor Tariff Court Ruling and Treasury Yields

The S&P 500 and Nasdaq gained on Thursday, lifted by a rally in Nvidia shares after the chipmaker’s strong revenue report. Meanwhile, a U.S. court ruling invalidating most of former President Trump’s tariffs added another layer of complexity to the market outlook, keeping gains in check.

Nvidia jumped 4.8% after topping sales forecasts, driven by robust demand for AI chips ahead of U.S. export restrictions to China. Despite warning that new curbs could trim $8 billion from current-quarter revenue, strong international demand helped offset investor concerns. The Philadelphia Semiconductor Index rose 1.2%, mirroring Nvidia’s surge.

How Did the Trump Tariff Block Impact Sentiment?

The U.S. Court of International Trade struck down most of Trump’s broad tariff measures, stating they exceeded presidential authority under the International Emergency Economic Powers Act. While the decision excludes industry-specific duties on steel, aluminum, and autos, it injected uncertainty into trade policy outlooks. The White House has appealed and could push for a Supreme Court intervention as soon as Friday.

Market enthusiasm cooled following the ruling, with megacaps retreating from early highs. Apple is nearly flat at 0.1%, while Salesforce slumped 6.3% despite raising its annual forecasts. Real estate and tech led sector gains, with eight of 11 major S&P 500 sectors edging higher. Boeing added 3.3% after reaffirming its 737 MAX production targets.

What Did Treasury Yields Reveal About Market Caution?

Treasury yields declined across the curve. The 10-year yield fell to 4.444%, while the 2-year dropped to 3.955%, reflecting investor caution. Initially, yields had climbed on hopes the court ruling might boost growth prospects, but that reversed following a slight rise in weekly jobless claims—a potential warning sign for labor market strength.

The market also digested a second estimate showing U.S. GDP contracted 0.2% in Q1, less than the expected 0.3% drop, adding mixed signals to the economic outlook.

What’s the Market Outlook as May Wraps Up?

Equities remain resilient heading into month-end. Both the S&P 500 and Nasdaq are tracking their best monthly performances since November, supported by easing trade fears, strong earnings, and subdued inflation. However, traders are now closely watching the fallout from the tariff ruling, ongoing corporate earnings, and labor market data for clues on the Fed’s next move.

Yields, trade policy, and chip demand will remain critical drivers into early June.

More Information in our Economic Calendar.