Dow leads Wall Street back in the green as Israel and Lebanon agree to talks

Markets closed higher on Thursday, with tech leading the way as investors looked past geopolitical tensions and focused on upcoming inflation data.

The Nasdaq climbed 0.8% to 22,822, extending its recent winning streak. The S&P 500 rose 0.6% to 6,825, while the Dow Jones Industrial Average also gained 0.6% to finish at 48,186.

It was a steady risk-on session, even as headlines out of the Middle East and the AI space kept sentiment choppy beneath the surface.

Oil prices moved higher ahead of upcoming Israel and Lebanon negotiations. The move was viewed as a potential step toward stabilizing the fragile ceasefire framework involving Iran, and even raised speculation about longer-term implications for regional shipping routes, including the Strait of Hormuz.

In individual stock action, Palantir dropped roughly 10% after renewed skepticism around its competitive position in the AI race. Investor Michael Burry argued that AI startup Anthropic is rapidly gaining ground, suggesting it is “eating Palantir’s lunch” as businesses increasingly shift toward simpler, cheaper AI solutions. The comments reignited debate about Palantir’s reliance on third-party models versus proprietary AI advantage.

Looking ahead, attention is turning to Friday’s US consumer price index (CPI) release. Economists are expecting an uptick in inflation for March, raising the stakes for the Federal Reserve outlook and keeping rate-cut expectations in flux.

• Constellation Brands Inc (NYSE:STZ) shares rose after it beat fourth-quarter expectations despite an 11% sales decline and issued a cautious fiscal 2027 outlook.

• The Simply Good Foods Company (NASDAQ:SMPL) shares plunged after reporting mixed second-quarter results, with revenue missing Wall Street estimates.

• CoreWeave announced a roughly $21 billion deal with Meta Platforms Inc to supply AI cloud capacity through 2032.

• Applied Digital Corp shares fell after strong revenue was overshadowed by large write-downs and a wider-than-expected net loss.

• Blackberry (TSX:BB) shares climbed after it beat fourth-quarter estimates and issued upbeat guidance, reflecting ongoing turnaround progress.

OpenAI expects to achieve $2.5 billion in advertising revenue this year and is eyeing $100 billion by 2030, Axios reported on Thursday.

The projections assume OpenAI’s products reach 2.75 billion weekly users by 2030 and capture a growing share of the global digital advertising market.

According to the report, which cited a source familiar with recent investor presentations, OpenAI plans for ad revenue to rise to $11 billion in 2027, $25 billion in 2028, and $53 billion in 2029.

Wells Fargo analysts agree that the recently announced Middle East ceasefire appears fragile, leaving geopolitical risks elevated.

While the bank expects active conflict to end by mid‑2026 and oil prices to ease in the second half of the year, uncertainty remains high.

The bank cut its 2026 global GDP forecast to 2.7%, citing higher oil prices, tighter financial conditions, and rising policy uncertainty. At the same time, inflation risks are skewed higher, with global CPI potentially exceeding Wells Fargo’s 4.4% forecast due to ongoing supply disruptions and market volatility.

“Shipping through Hormuz and energy production will recover slowly, if at all, without durable peace,” analysts wrote. “Physical supply constraints and infrastructure damage likely persist for months.”

The softer GDP figure suggests slower economic growth as markets head into the conflict with Iran, as well as lingering uncertainty over whether a ceasefire will hold could put additional downward pressure on markets today, according to Chris Zaccarelli, Chief Investment Officer for Northlight Asset Management.

“We didn’t see elevated readings in the February inflation data, which means we were in a good starting place, but the war – and the elevated energy prices that came with it – will likely filter into the March PCE readings, which will be released at the end of this month,” Zaccarelli commented.

“Given the slower GDP and job growth, along with concerns about inflation re-accelerating, the Fed will have no choice but to sit on the sidelines for an extended period of time, leaving traders to hope for a Trump Put, now that the Fed Put is no longer active.”

Stocks opened slightly lower Thursday as investors weighed mixed economic data against renewed tensions in the Middle East.

The Nasdaq opened at 22,588, down 0.2%, the Dow at 47,864, down 0.1%, and the S&P 500 at 6,775, also down 0.1%.

Iran has once again halted tanker traffic, citing continued strikes by US ally Israel on Lebanon as a violation of a prior deal. President Trump responded that US troops will remain in the region until Tehran complies with the “real agreement,” keeping geopolitical risks in focus.

Economic indicators offered a mixed picture. Core PCE inflation came in line with expectations at 3% year-over-year, while personal spending rose 0.5% month-over-month, slightly below forecasts. Meanwhile, the final reading for Q4 GDP showed growth of 0.5%, down from the preliminary 0.7% estimate.

On the corporate front, tech names were in focus. CoreWeave jumped at the open following news of an expanded partnership with Meta, and BlackBerry surged 10% after posting stronger-than-expected earnings.

Oil prices climbed, though both West Texas Intermediate and Brent crude remained under $100 per barrel, adding another layer of caution to the trading day.

U.S. stock futures are pulling back early Thursday, giving back a bit of the momentum from the previous session’s relief rally as geopolitical nerves creep back in.

Futures tied to the Dow Jones Industrial Average are down about 0.4%, while S&P 500 and Nasdaq 100 contracts are off 0.4% and 0.3%, respectively.

The softer tone comes after a strong Wednesday, when investors piled into risk assets on hopes that tensions in the Middle East might ease. That optimism is already looking shaky.

US and Iranian negotiators are set to meet in Islamabad later today, but the backdrop remains fragile. Ongoing Israeli strikes in Lebanon and President Donald Trump’s insistence that US troops will stay in the region until a “real agreement” is reached are keeping investors on edge.

Oil is reflecting that uncertainty. Brent crude is holding above $97 a barrel, supported by supply concerns around the Strait of Hormuz. According to XTB’s Kathleen Brooks, the initial ceasefire-driven rally has stalled as the news flow has turned more negative.

“Only three ships passed through the Strait of Hormuz on Wednesday, while roughly 800 tankers are still waiting,” she noted, suggesting that disruptions could linger and keep a floor under oil prices for now.

On the corporate side, Applied Digital is under pressure in premarket trading. The data-center developer delivered an earnings beat, but the lack of new hyperscaler deals appears to be disappointing investors who were looking for fresh catalysts.

It’s also shaping up to be a busy morning for macro data. Investors will be parsing weekly jobless claims, the personal consumption expenditures index for February, and the second revision to fourth-quarter GDP, all due at 8:30 a.m. ET. Wholesale inventories follow at 10 a.m.

In fixed income, a hefty $22 billion auction of 30-year Treasurys is on deck, which could test demand at the long end of the curve amid ongoing inflation concerns.