Stock indexes closed higher on Thursday, with the S&P 500 up +0.26%, Dow Jones up +0.60%, and Nasdaq up +0.32%. Chip makers rallied on strong AI demand outlook from TSMC, boosting indexes. Weekly jobless claims fell, easing geopolitical tensions in Iran. Fed comments on inflation pushed bond yields higher. US economic data showed strength.

TSMC forecasted strong Q1 sales, boosting capital expenditure to $52-$56 billion. US economy showed strength with lower jobless claims and rising business outlook surveys. Geopolitical tensions eased in Iran. Fed comments on inflation pushed bond yields higher. Stock indexes closed higher, led by chip makers. Earnings season set to begin. Market focused on economic news and Fed updates.

US weekly initial unemployment claims fell to a 6-week low of 198,000, showing a strong labor market. Jan Empire manufacturing survey rose more than expected to 7.7. Jan Philadelphia Fed business outlook survey also rose more than expected to 12.6. President Trump has no plans to fire Fed Chair Powell. Supreme Court delays ruling on Trump’s tariffs.

European government bond yields rose. Eurozone industrial production increased, UK manufacturing production and GDP were stronger than expected. Swaps discount a 1% chance of ECB rate hike. US stock movers: Chip makers gain, energy stocks fall, cryptocurrency-exposed stocks drop. Calavo Growers, Talen Energy, Penumbra, Morgan Stanley, and Black Rock saw gains.

Stocks in overseas markets settled mixed. Interest rates: 10-year T-note yield rose to 4.160%, European bond yields increased. US stock movers: Chip makers gain, energy stocks fall, cryptocurrency-exposed stocks drop. Earnings reports expected for BOK Financial, M&T Bank, PNC Financial, Regions Financial, State Street Corp. Market awaits economic data and Fed updates.

Read more at Nasdaq: Stocks Boosted by Chip Demand Optimism