US stocks rally toward fresh records as Cisco jumps on strong earnings

NEW YORK (AP) — The U.S. stock market is rising toward more records Thursday after Cisco Systems joined the parade of U.S. companies reporting fatter profits for the start of 2026 than analysts expected.

The S&P 500 added 0.8% to its all-time high set the day before. The Dow Jones Industrial Average climbed 383 points, or 0.8%, and is on track to finish the day above 50,000 for the first time since the war with Iran began. The Nasdaq composite was 0.9% higher and adding to its own record, with an hour left to trade.

Cisco helped lead the market after reporting better profit and revenue for the latest quarter than analysts expected. The tech giant’s stock leaped 13%, and CEO Chuck Robbins said it saw “very strong, broad-based demand for our products.”

Big Tech behemoths in particular are pouring cash into artificial-intelligence technology, and Cisco gave a forecast for profit in the current quarter that easily topped analysts’ expectations.

Such voracious demand for AI, and the big profits it’s producing, have been major reasons the U.S. stock market has set records throughout this year. Cerebras Systems, an AI processor company, raised $5.55 billion after selling its stock in an initial public offering, and its shares surged 72% in their debut on the Nasdaq.

Corporate earnings reported so far this season have “reinforced that this is still an AI-led market, but one where the impact is broadening quickly,” according to Gargi Pal Chaudhuri, chief investment and portfolio strategist at BlackRock.

“What started with a handful of companies is now driving earnings growth across semiconductors, infrastructure, and even parts of the industrial economy,” she said.

Outside of AI, other stocks rallying after delivering better-than-expected profit reports included StubHub Holdings, up 15.3%, Viking Holdings, up 6.4% and Yeti Holdings, up 7%.

All three companies sell products that aren’t day-to-day essentials, such as concert tickets, river cruises and insulated water bottles. Strong results from them could be an indicator that customers are still willing to spend even though U.S. consumers have been telling surveys they’re feeling discouraged about the economy.

Whether U.S. households will keep spending and support the economy is a big question because pressure has been rising on them due to high oil prices and inflation created by the Iran war. A report released Thursday said that shoppers overall spent less at U.S. retailers last month than economists expected. But the deceleration after factoring out gasoline and automobile sales wasn’t quite as bad as economists thought it would be.

A separate report, meanwhile, said more U.S. workers filed for unemployment benefits last week, which could be an indication of more layoffs. The number, though, remains relatively low compared with history.

Treasury yields flitted up and down in the bond market immediately after the reports, but they largely remained steady. The yield on the 10-year Treasury remained at 4.46%, where it was late Wednesday.

In stock markets abroad, indexes rose in Europe following a mixed finish in Asia. Japan’s Nikkei 225 fell 1%, while South Korea’s Kospi jumped 1.8% to another record thanks to gains for AI-related stocks.

Stocks were virtually flat in Hong Kong and down 1.5% in Shanghai as Chinese leader Xi Jinping met with U.S. President Donald Trump in Beijing.

Some investors hope Trump could encourage Xi to use China’s close economic ties with Iran to get it to reopen the Strait of Hormuz. The strait’s closure because of the war has kept oil tankers pent up in the Persian Gulf instead of delivering crude to customers worldwide, which has driven up crude prices.

The price for a barrel of Brent crude oil, the international standard, rose 0.1% to settle at $105.72 Thursday, and it remains well above its price of roughly $70 from before the war.

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AP Business Writers Chan Ho-him and Matt Ott contributed to this report.