US sharemarkets advanced on Thursday, extending gains from the previous session as easing geopolitical concerns triggered a broad-based rally across equities.
The Dow Jones Industrial Average rose 0.6 per cent to close at 49,384, recovering losses recorded earlier in the week following tariff threats from Donald Trump. The S&P 500 added 0.6 per cent to finish at 6,913, while the Nasdaq Composite outperformed, gaining 0.9 per cent to settle at 23,436.
Markets finished below their session highs after stronger early momentum faded, but sentiment remained constructive. Despite Thursday’s gains, the S&P 500 and Nasdaq are still tracking modest weekly declines, while the Dow is narrowly positive for the week.
Tech leaders drive Nasdaq higher
Technology stocks led the advance, supporting the Nasdaq’s outperformance. Nvidia, Microsoft, and Meta Platforms were among the strongest contributors.
Market breadth also improved beneath the surface, with smaller and mid-sized companies participating in the rally. The Russell 2000 index of small-cap stocks rose about 2 per cent on Wednesday and closed at a record high, highlighting resilience beyond the largest index heavyweights.
Policy signals calm markets
The rebound followed a sharp turnaround from Tuesday’s sell-off, when renewed tariff rhetoric prompted a brief “sell America” trade, pressuring equities, the US dollar, and Treasuries.
Confidence stabilised after Trump indicated that previously flagged tariffs on imports from eight European countries would not proceed and signalled progress toward a diplomatic framework involving Greenland. Earlier comments at the World Economic Forum in Davos also helped reassure markets, with Trump ruling out the use of force in future negotiations.
While diplomatic discussions remain ongoing, recent signals have reduced immediate geopolitical risk premiums priced into global markets.
Global data and central banks in focus
Looking ahead, attention turns to New Zealand’s fourth-quarter inflation data, where CPI is expected to remain elevated enough to limit further near-term rate cuts. The Bank of Japan will also hold a policy meeting, with markets expecting policymakers to remain cautious as they assess wage developments ahead of spring negotiations.
A series of manufacturing PMI readings is due across Japan, Europe, the UK, and the US, providing fresh insight into global economic momentum as markets head into the final trading session of the week.
Australian market set for muted open
Australian shares are expected to open slightly lower, with ASX 200 futures down 8 points, or 0.09 per cent, to 8,802.
