The U.S Stock Market Rallies After Alphabet and Apple Win in Court

U.S. equities rose on Wednesday, breaking a two-day slump as big tech names staged a comeback following a legal victory for Alphabet Inc. and Apple Inc.
The S&P 500 gained 0.4%, with five of its 11 sectors finishing higher.

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The tech-heavy Nasdaq 100 added 0.5%, while an index tracking the Magnificent Seven surged 1.73%. The Cboe Volatility Index hovered near 17, signaling steady market sentiment. Meanwhile, the 10-year Treasury yield stood at 4.26%.

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Google avoided a potential breakup after a federal judge rejected the government’s toughest remedies in the most significant antitrust trial in 30 years. The ruling also benefited Apple, as Google will continue paying partners to feature its search engine.

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Apple reportedly receives about $20 billion annually for keeping Google search as the default on iPhones. Following the decision, Alphabet shares jumped 8%, reaching an all-time high, while Apple climbed 2%.

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“The outcome was far better for Google than expected,” said JPMorgan analyst Doug Anmuth. He added that the court acknowledged the fast-changing and increasingly competitive search market driven by generative AI innovations.

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Market participants are now eyeing fresh economic and corporate updates. The JOLTS job openings report will be released at 10 a.m., while Salesforce Inc.’s quarterly results are expected after the bell. Shares of Salesforce rose 0.9% ahead of earnings, though the stock has plunged about 24% this year, with Mizuho Securities categorizing it among the “AI laggards.”

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In retail, Dollar Tree Inc. tumbled 7.9% after its second-quarter results reflected challenges tied to inventory management and tariff-related pressures. On the flip side, Macy’s Inc. soared 20% after boosting its annual forecast and reporting its strongest comparable sales growth in three years a major confidence boost for the struggling department store sector.

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Later in the week, investors will turn their attention to labor market data, which remains a critical factor for the Federal Reserve’s policy outlook. Thursday brings ADP’s employment report, followed by the highly anticipated nonfarm payrolls report on Friday.

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These figures could sway expectations on the pace and scale of interest rate adjustments.
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On the corporate front, Broadcom Inc. is set to report earnings Thursday, adding another key tech catalyst to the mix.

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Federal Reserve Governor Christopher Waller indicated earlier that the central bank should begin cutting rates this month and implement several reductions over the next few months. He also downplayed the inflationary risk of tariffs and emphasized the need to stay ahead of potential labor market weakness.

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Wednesday’s rebound underscores how quickly sentiment can shift when legal and policy uncertainties are resolved in favor of major players like Alphabet and Apple. With tech leading the charge and macroeconomic data on the horizon, investors should stay alert for potential market swings. Rate cut expectations, labor trends, and upcoming earnings could set the tone for the next leg of the rally.

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