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Microsoft ( MSFT ), Meta rise after quarterly results

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Semiconductor stocks weak

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Economic data shows inflation rise, stable labor market

(Updates to market close)

By Chuck Mikolajczak

NEW YORK, July 31 (Reuters) -

U.S. stocks closed well off early highs on Thursday,

following the latest round of corporate earnings and economic

data, as investors awaited results from megacaps Amazon ( AMZN ) and

Apple ( AAPL ) due after the closing bell.

Microsoft ( MSFT ) shares rose after it posted a

strong earnings

report and briefly surpassed the $4 trillion

market cap threshold

, becoming only the second publicly traded company to ever

touch the milestone after Nvidia ( NVDA ).

Meta Platforms ( META ) surged and hit an intraday record

high of $784.75 as AI-driven growth in its core ad business

powered a bullish revenue forecast.

Still, other AI-related names such as chipmakers Broadcom ( AVGO )

and Nvidia ( NVDA ) were weaker on the session, which weighed on

the PHLX semiconductor index.

"Looking at the market action today, you have haves and

have-nots, and so you have a couple tech companies, like a lot

of the semiconductor-related and semi-cap equipment-related

stocks are doing pretty poorly," said Ellen Hazen, chief market

strategist at F.L. Putnam Investment Management in Lynnfield,

Massachusetts.

"But then, of course, Microsoft ( MSFT ) is doing pretty well, and

the same thing with Amazon ( AMZN ) and Meta, which are doing really

well."

Of the 297 companies in the S&P 500 that have reported

earnings through Thursday morning, 80.8% have topped analyst

expectations, according to LSEG data, compared with the 76% beat

rate over the past four quarters

According to preliminary data, the S&P 500 lost 19.33

points, or 0.37%, to end at 6,339.31 points, while the Nasdaq

Composite gained 8.40 points, or 0.04%, to 21,138.08.

The Dow Jones Industrial Average fell 320.83 points, or

0.72%, to 44,140.45.

The S&P 500 had risen as much as 1% and the Nasdaq as much

as 1.5% earlier in the session. The Nasdaq has not logged a move

of at least 1% in either direction since July 3 while the S&P

last recorded a daily 1% move on June 24.

Earlier economic data from the Commerce Department report showed

inflation picked up in June, with new tariffs pushing prices

higher and stoking expectations that price pressures could

intensify in the coming months, while weekly initial jobless

claims signaled the labor market remained on stable footing.

Investors will now eye Friday's non-farm payrolls report

and a looming tariff deadline, as U.S. President Donald Trump

was expected to issue higher final duty rates for countries that

have not reached an agreement, although Mexico was granted a

90-day reprieve.

U.S. stocks have rallied after a sharp selloff that began

in early April after Trump announced a bevy of sharp tariffs,

only to rebound as deals have been struck with many trading

partners on duty levels. The Dow, S&P 500 and Nasdaq recorded

their third straight monthly gain.

Drug stocks were also weaker after the White House said Trump

sent letters to the CEOs of 17 major pharmaceutical companies,

urging immediate action to lower the cost of prescription drugs

for Americans. The NYSE Arca pharmaceutical index was

down 2.3%.