U.S. stock markets opened higher on Thursday, rebounding from Wednesday's notable decline, driven by gains in Microsoft and semiconductor stocks. The rebound follows the Federal Reserve's decision to hold interest rates steady, which had triggered a sell-off the previous day.

The Dow Jones Industrial Average rose 309.99 points, or 0.60%, to 51,904.13. The Nasdaq Composite gained 387.05 points, or 1.58%, to 24,829.99, while the S&P 500 added 72.92 points, or 1.00%, to 7,389.07. Microsoft shares surged, supported by growth in its Azure cloud business.

The semiconductor sector followed suit, with the iShares Semiconductor ETF (SOXX) climbing more than 3%. In contrast, Meta Platforms, Inc. shares fell sharply after the company issued a weak revenue outlook and disclosed that its second-quarter free cash flow plunged 91%.

Commenting on the divergent paths of Microsoft and Meta Platforms, Inc., Stephen Evans, Chief Investment Officer at Pave Finance, noted: "This ultimately reflects two different AI investment strategies. One company is increasing profits while spending heavily, while the other is allowing those costs to erode its bottom line."

U.S. Treasury yields remained under pressure, with the 30-year bond yield hovering near 2007 highs after the Fed's decision to keep rates unchanged. Wall Street had a subdued session on Wednesday, with the Dow plunging more than 1,100 points, marking its worst single-day performance since April 2025.

Samir Samana, Head of Global Equity and Physical Assets at Wells Fargo Investment Institute, commented: "The Fed remains in a patient and wait-and-see mode, continuing to monitor how the economy evolves over the coming months. This makes the September meeting a 'live' opportunity, where the Fed could act to ease rising inflation pressures if subsequent data supports it."

Investors received several new economic data points on Thursday. The Bureau of Labor Statistics reported that second-quarter GDP grew by just 1.5%, below the 1.8% forecast by economists surveyed by Dow Jones, and compared to 2.1% growth in the first quarter. The Personal Consumption Expenditures (PCE) price index, seasonally adjusted, fell 0.1% for the month, bringing the annual inflation rate to 3.7%, in line with expectations. Excluding food and energy, core PCE rose 0.1% month-over-month and 3.3% year-over-year, compared to forecasts of 0.2% and 3.3%, respectively. The Labor Department also reported that initial jobless claims for the week ending July 25 were 197,000, an increase of 9,000 from the prior week's revised level.

One of the busiest weeks for corporate earnings continues, with Bristol-Myers Squibb releasing results before the market open. Amazon, Apple, and Coinbase are scheduled to report after the closing bell.