Stocks Rally into Holiday Break as Tech Momentum, Trump Tax Bill Drive Optimism

U.S. equity markets closed early Thursday with solid gains across the board, as a bullish backdrop for technology stocks, encouraging labor market data, and momentum behind President Donald Trump’s sweeping tax legislation fueled investor enthusiasm ahead of the Independence Day holiday.

The Dow Jones Industrial Average rose 344.11 points, or 0.77%, to close at 44,828.50. The Nasdaq Composite advanced 207.97 points, or 1.02%, ending the session at 20,601.10, while the S&P 500 added 51.93 points, or 0.83%, to finish at 6,279.35.

Market breadth reflected the upbeat tone: nearly 68% of NYSE-listed stocks advanced, and over 1,200 names hit new 52-week highs, according to Finviz data.

Leading the charge were technology stocks, buoyed by a bullish industry note from Wedbush Securities that forecasted a strong second half of the year driven by AI-related spending. “We believe tech stocks will have a very strong second half of the year with the AI Revolution tailwinds now accelerating across semis, software, and the enterprise and consumer landscape,” wrote analysts Daniel Ives and team.

Wedbush emphasized that enterprise and government investments—estimated at $2 trillion over the next three years—will drive a multi-year transformation across software and chipmakers. Top Wedbush picks for the back half of 2025 include Nvidia, Meta, Microsoft, Palantir, and Tesla, with Nvidia and Microsoft viewed as frontrunners to enter the $4 trillion market cap club this summer.

The tech rally coincided with a steady labor market report released Thursday morning. The U.S. economy added 147,000 jobs in June, aligning with its 12-month trend, while the unemployment rate remained at 4.1%, according to the Bureau of Labor Statistics. Average hourly earnings rose modestly, and long-term unemployment ticked higher, offering a mixed but stable picture of the job market.

Markets also responded positively to signs of progress on President Trump’s “big, beautiful bill,” a $4.5 trillion tax-and-spending package that cleared a key procedural hurdle in the House early Thursday morning. The legislation features sweeping tax cuts, expanded defense and border spending, and pared-down reductions to social programs. While Republicans had initially splintered over the bill’s fiscal impact, the GOP ultimately coalesced following overnight negotiations led by House Speaker Mike Johnson.

President Trump took to Truth Social to urge lawmakers forward, warning: “MAGA IS NOT HAPPY, AND IT’S COSTING YOU VOTES!!!” He later posted, “Let’s go, Republicans … delivering the Biggest Tax Cuts in History and MASSIVE Growth”.

With investors eyeing the second half of the year, the S&P 500 and Nasdaq are riding high on AI momentum and fiscal optimism. Markets will be closed Friday in observance of the July 4th holiday.