NEW YORK (AP) — On Thursday, U.S. stock markets approached record highs as major corporations continued to report profits that surpassed expectations. Wall Street displayed minimal reaction to the recent tariff announcements from President Donald Trump, which are expected to be implemented in the coming months.

Late in the trading session, the S&P 500 rose by 0.9%, approaching within 0.2% of the previous month’s record high. The Dow Jones Industrial Average increased by 358 points, representing a 0.8% gain, while the Nasdaq composite climbed 1.3% higher.

MGM Resorts International saw a remarkable increase of 17.2% after reporting quarterly earnings that significantly exceeded analysts’ expectations. The company attributed its success to growth in China, coupled with positive trends in its Las Vegas and North American digital operations.

Other firms also reported better-than-anticipated profits, including GE HealthCare Technologies, which rose by 9.3%, Molson Coors Beverage with an 8.8% increase, and Robinhood Markets, which surged by 13.8%.

These positive earnings reports, alongside a significantly robust U.S. economy, have kept stocks close to their all-time highs. A recent report indicated that fewer workers filed for unemployment benefits last week, suggesting a strong labor market.

Despite this, several factors are pressuring stock prices. Chief among these are concerns about persistently high inflation rates. A Thursday report revealed that wholesale inflation was stronger than economists had predicted last month, following a similar consumer-level inflation report released the day prior.

Tariffs could exacerbate inflation by increasing import costs. President Trump unveiled a strategy on Thursday aimed at raising U.S. tariffs on imports from various countries, which will be tailored partly based on how these countries tax U.S. goods.

While economists caution about the adverse effects of such tariffs, financial markets seem to be absorbing these threats without panic. There is a prevailing belief that Trump’s assertive rhetoric is aimed at influencing negotiations, and he may not fully implement the threats to avoid harming the U.S. stock market and the economy.

According to a senior White House official speaking on the condition of anonymity, the reviews necessary for the tariffs announced could take a few weeks to a few months, providing ample time for negotiations that could lead to lower tariffs.

This belief that the stock market serves as a constraint on Trump carries its own risks. If the market continues to withstand escalating threats without consequences, it may encourage Trump to take more drastic actions.

For now, however, analysts suggest Trump may be somewhat “boxed in” following the recent high inflation figures, tempering actions that could push inflation even higher, as noted by Thierry Wizman, a strategist at Macquarie.

Trump has previously shown his ability to retract threats swiftly, as seen when he paused a proposed 25% tariff on imports from Canada and Mexico for 30 days.

Nonetheless, he proceeded with a 10% tariff on Chinese goods, which GE HealthCare factored into its 2025 profit forecasts and other financial metrics.

On Wall Street, Deere & Co. saw a 1% decline after announcing a dramatic 30% drop in fourth-quarter sales and a 50% fall in profits. The company stated that it is focused on managing inventory amid “uncertain market conditions” faced by its customers.

Reddit dropped 5.8%, despite surpassing Wall Street’s expectations for fourth-quarter sales and profit.

Cisco Systems climbed 2.6% after reporting better-than-expected profits, driven by strong demand across its product range, including advancements in artificial intelligence infrastructure.

In the bond market, Treasury yields softened. Generally, disappointing indicators of wholesale inflation can lead to increased yields, yet economists identified some positive trends within Thursday’s data, such as lower healthcare service costs, which might contribute to a decrease in another inflation measurement that the Federal Reserve monitors closely.

The yield on the 10-year Treasury bond fell from 4.63% to 4.52%.

In addition to tightening household budgets, persistent inflation is expected to maintain the Federal Reserve’s stance on interest rates for the foreseeable future, eliminating relief options for Americans through lower rates.

Previously, the Fed had sharply reduced interest rates from September to the end of last year to stimulate borrowing and support economic growth, boosting prices across various assets. However, the Fed warned at the end of 2024 about minimal rate cuts in 2025 due to ongoing concerns over stubborn inflation, with a target of 2% inflation and cautious about rate reductions fueling further inflation.

Globally, stock indices displayed mixed performances across Europe and Asia.

___

Contributions to this report were made by AP Business Writers Yuri Kageyama and Matt Ott.