Live: US stocks lift and ASX 200 set to follow

U.S. stock markets experienced a significant rally on Thursday, propelled by a substantial 15.5% surge in Microsoft's shares. The tech giant's impressive performance followed forecasts for current-quarter sales and cloud growth that surpassed Wall Street's expectations. This surge added $450 billion in market value to Microsoft, marking the largest single-day dollar gain in its history.

The broader market also saw gains, with the Dow Jones Industrial Average rising 1.2%, the S&P 500 climbing 1.7%, and the Nasdaq Composite up 2.8%. The MSCI All Country World Price index increased by 1.6%. However, underlying investor concerns about inflation persist, as evidenced by the 30-year U.S. Treasury yield reaching a 19-year peak of 5.2444%. This rise followed comments from Federal Reserve Chair Kevin Warsh, which unsettled investors regarding the Fed's vigilance against long-term inflation.

Adding to market dynamics, the Japanese yen rallied sharply by 2.53% to 159.34 per U.S. dollar, fueling speculation of potential intervention by Japanese officials to support the currency. This currency movement occurred against a backdrop of investor unease regarding rising artificial intelligence costs at major technology firms, even as many report strong earnings.

Recent negative cash-flow reports from Alphabet and Tesla had previously triggered a selloff in AI-linked stocks and pressured chip stocks, as investors questioned high valuations. "Microsoft delivered yesterday, and maybe Microsoft is going to be able to move itself from the 'battleground' camp to be a 'trusted AI winner' stock," commented Jed Ellerbroek, portfolio manager at Argent Capital Management, reflecting the market's reaction to Microsoft's performance.

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Microsoft delivered yesterday, and maybe Microsoft is going to be able to move itself from the 'battleground' camp to be a 'trusted AI winner' stock.