U.S. Stocks Rally On Upbeat Tech Earnings
26 Abril 2024 - 5:30PM
IH Market News
Stocks moved sharply higher during trading on Friday, largely
offsetting the weakness seen during Thursday’s session. The major
averages all moved to the upside on the day, with the tech-heavy
Nasdaq leading the charge.
The major averages pulled back off their best levels late in the
day but remained firmly positive. The Nasdaq surged 316.14 points
or 2.0 percent to 15,927.90, the S&P 500 jumped 51.54 points or
1.0 percent to 5,099.96 and the Dow climbed 153.86 points or 0.4
percent to 38,239.66.
For the week, the Nasdaq spiked by 4.2 percent, the S&P 500
shot up by 2.7 percent and the Dow advanced by 0.7 percent.
The rally on Wall Street came amid a positive reaction to some
of the latest earnings news from big-name tech companies.
Shares of Alphabet (NASDAQ:GOOGL) soared by 10.2 percent after
the Google parent reported better than expected first quarter
results and authorized its first-ever dividend as well as a $70
billion stock buyback.
Software giant Microsoft (NASDAQ:MSFT) also jumped by 1.8
percent after reporting fiscal third quarter results that exceeded
expectations.
Shares of Snap (NYSE:SNAP) skyrocketed by 27.6 percent after the
SnapChat parent reported first quarter results that exceeded
expectations on both the top and bottom lines.
On the other hand, shares of Intel (NASDAQ:INTC) plunged by 9.2
percent after the semiconductor giant reported first quarter
earnings that beat estimates but provided disappointing
guidance.
Traders also seemingly reacted positively to closely watched
readings on inflation released by the Commerce Department showing
consumer prices in the U.S. increased in line with economist
estimates in the month of March.
The Commerce Department said its consumer price index rose by
0.3 percent in March, matching the increase seen in February as
well as economist estimates.
Excluding food and energy prices, core consumer prices also
climbed by 0.3 percent for the second straight month, in line with
expectations.
Meanwhile, the report said the annual rate of consumer price
growth accelerated to 2.7 percent in March from 2.5 percent in
February. Economists had expected the pace of growth to tick up to
2.6 percent.
The annual rate of growth by core consumer prices in March came
in unchanged from February at 2.8 percent, while economists had
expected the pace of growth to slow to 2.6 percent.
The readings on inflation, which are said to be preferred by the
Federal Reserve, were included in the Commerce Department’s report
on personal income and spending in the month of March.
“Given the elevated levels of inflation – and this is the new
normal for 2024 – the market is going to need to get over hopes for
Fed rate cuts,” said Chris Zaccarelli, Chief Investment Officer for
Independent Advisor Alliance.
“We’re still optimistic on the market, however, as we believe
that rate cuts aren’t necessary for the bull market to continue,”
he added. “Instead, continued economic expansion and growth in
corporate profits – which are already seeing from the largest
companies in the market – are what will propel stock prices to new
highs.”
Treasury yields moved lower following the release of the report,
which may have helped mitigate any negative response to the
data.
Sector News
Semiconductor stocks saw substantial strength on the day despite
the slump by Intel, with the Philadelphia Semiconductor Index
surging by 2.6 percent.
Significant strength was also visible among software stocks
following Microsoft’s upbeat results, resulting in a 1.5 percent
gain by the Dow Jones U.S. Software Index.
Networking stocks also saw considerable strength on the day,
driving the NYSE Arca Networking Index up by 1.5 percent.
Retail, computer hardware and brokerage stocks also showed
notable moves to the upside, while utilities stocks bucked the
uptrend.
Other Markets
In overseas trading, stock markets across the Asia-Pacific
region moved mostly higher during trading on Friday. Japan’s Nikkei
225 Index climbed by 0.8 percent, while Hong Kong’s Hang Seng Index
surged by 2.1 percent.
The major European markets also moved to the upside on the day.
While the German DAX Index jumped by 1.4 percent, the French CAC 40
Index and the U.K.’s FTSE 100 Index advanced by 0.9 percent and 0.8
percent, respectively.
In the bond market, treasuries regained ground after moving
notably lower over the two previous sessions. Subsequently, the
yield on the benchmark ten-year note, which moves opposite of its
price, fell 3.7 basis points to 4.669 percent.
Looking Ahead
While the Fed’s monetary policy announcement is likely to be in
the spotlight next week, traders are also likely to keep a close
eye on the monthly jobs report.
Reports on manufacturing and service sector activity may also
attract attention along with an avalanche of corporate earnings
news.
SOURCE: RTTNEWS
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