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UPS down after lower-than-expected 2025 revenue forecast

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Microsoft ( MSFT ) forecast disappoints

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Indexes: Dow up 0.4%, S&P 500 up 0.5%, Nasdaq up 0.3%

(Updates with volumes, share moves)

By Caroline Valetkevitch

NEW YORK, Jan 30 (Reuters) - U.S. stocks ended a

volatile session higher on Thursday as investors digested a

stack of key earnings reports, with upbeat comments from Tesla

helping to offset a disappointing forecast from

Microsoft ( MSFT ).

Indexes briefly lost ground late in the session after U.S.

President Donald Trump said the United States will put a 25%

tariff on imports from Mexico and Canada, two of the U.S.'s top

trading partners.

He

said he would

likely decide by the end of the day whether to put a 25%

tariff on imports of Mexican and Canadian oil that would take

effect on Feb. 1.

Worries about Trump's possible tariffs and their impact

on the U.S. economy and inflation have kept investors on edge.

"Until we understand what tariff policies, what fiscal

policies are going to go into play, it's going to be very

difficult for the market to find a trajectory that is

sustainable," said Oliver Pursche, senior vice president,

advisor for Wealthspire Advisors in Westport, Connecticut.

"We're probably going to see increased volatility, but

it'll be range-bound," he said.

All of the S&P 500 sectors rose except for technology

on Thursday, with communication services and

financials registering record closing highs.

Tesla shares gained 2.9% and were among the biggest boosts

to the S&P 500. CEO Elon Musk vowed to launch long-awaited

cheaper models in the first half of 2025 and start testing an

autonomous ride-hailing service in June. The comments

overshadowed its quarterly results that fell short of

expectations.

Shares of Microsoft ( MSFT ) dropped 6.2% after the company

forecast disappointing growth in its cloud computing business.

The Dow Jones Industrial Average rose 168.61 points,

or 0.38%, to 44,882.13, the S&P 500 gained 31.86 points,

or 0.53%, to 6,071.17, and the Nasdaq Composite added

49.43 points, or 0.25%, at 19,681.75.

Also helping the S&P 500 was Meta, whose shares

gained 1.6% after the company beat Wall Street's fourth-quarter

revenue estimates but said current-quarter sales may not meet

forecasts. IBM ( IBM ) shares jumped 13% in its biggest daily

percentage gain since 1999 after the company surpassed

fourth-quarter profit expectations.

Investors also took in comments from the CEOs of Meta and

Microsoft ( MSFT ) defending their heavy investments in artificial

intelligence, days after Chinese startup DeepSeek unveiled a

breakthrough in cheap AI models that rattled Wall Street and

triggered a sell-off in AI-linked stocks.

Friday brings the U.S. personal consumption expenditures

price index report for December.

The Federal Reserve on Wednesday

kept interest rates steady and Fed Chair Jerome Powell said

inflation and jobs data would determine when another easing

would come.

So far this reporting period, more than 70% of S&P 500

company earnings reports on the final quarter of 2024 have

beaten analysts' expectations, LSEG data showed.

Among other outlooks, United Parcel Service ( UPS )

forecast 2025 revenue below expectations. Its shares fell 14.1%

and weighed on the Dow Jones Transportation Average.

After the closing bell, Apple ( AAPL ) shares fell about

1%. The company beat analysts' quarterly profit estimates on

Thursday, but posted weak iPhone sales and China revenue for the

holiday quarter.

Advancing issues outnumbered decliners by a 4.1-to-1

ratio on the NYSE. There were 254 new highs and 52 new lows on

the NYSE.

On the Nasdaq, 2,938 stocks rose and 1,470 fell as

advancing issues outnumbered decliners by a 2-to-1 ratio.

Volume on U.S. exchanges was 13.79 billion shares,

compared with the 15.4 billion average for the full session over

the last 20 trading days.

(Additional reporting by Shashwat Chauhan and Sukriti Gupta in

Bengaluru; Editing by Pooja Desai, Shounak Dasgupta and Richard

Chang)