Wall Street Today | S&P Closes Above 5,000, as Nvidia, AMD, Broadcom Sustain Rally
RECAP
US stocks continued their march higher, with the S&P 500 decisively closing above the 5,000 level for the first time ever. The rally has been fueled continued strong corporate earnings and signs of progress in the Federal Reserve's goal of lowering inflation that could move policy makers to finally start cutting rates.
The $S&P 500 Index (.SPX.US)$ rose for a 14th week out of 15, the first for large-cap index since March 10, 1972, MarketWatch reported, citing Dow Jones Market Data.
Technology stocks drove the market higher, the best performer among the eight sectors that rose Friday. Semiconductor companies $Lam Research (LRCX.US)$ and $KLA Corp (KLAC.US)$ led gains in the tech heavy $NASDAQ 100 Index (.NDX.US)$. Chip giant $NVIDIA (NVDA.US)$, rival $ASML Holding (ASML.US)$, $Applied Materials (AMAT.US)$ and $Broadcom (AVGO.US)$ joined them in the 10 biggest gainers on the index.
The $S&P 500 Index (.SPX.US)$ rose 0.6% to close at 5,026, while the $NASDAQ 100 Index (.NDX.US)$ gained 1%. The $Dow Jones Industrial Average (.DJI.US)$ slipped 0.1%.
The meteoric rise of semiconductors has been driven by optimism over surging demand for chips that will be used to power artificial intelligence applications. That rosy outlook was confirmed by the latest earnings results from $Arm Holdings (ARM.US)$.
MACRO
Slowing Inflation
US government data showed consumer prices rose at a slower pace in December, adding to evidence that inflation is staying on a downward trajectory and moving closer to the Federal Reserve's inflation target. The latest government revision showed inflation was at 0.2% in the last month of 2023, slower than the initial 0.3% reported earlier.
SECTORS
Crude oil futures closed higher for a fifth-straight day as declining gasoline inventories in the US fueled hopes of stronger demand at a time when geopolitical tensions in the Middle East are reviving fears of disruption to supply.
Gold slipped as Treasury yields rose, curbing the investment appeal of the precious metal that doesn't pay holders any income. The downward revision in the consumer price index in December also weakened the case for owning the commodity that's used as a hedge against inflation.
COMPANIES
Bitcoin Frenzy
$Coinbase (COIN.US)$, $MARA Holdings (MARA.US)$ and other crypto-related stocks mostly rose Friday after $Bitcoin (BTC.CC)$ topped $47,000 for the first time in nearly two years. $Bit Brother (BETS.US)$ bucked the trend, pulling back 18.6%. The pullback came as the stock gave back some of its 96.6% ascent on Thursday.
Hefty Premium
Shares of $Masonite (DOOR.US)$ soared Friday after the door-maker agreed to be acquired by $Owens-Corning (OC.US)$ for a 38% premium under a cash deal that values the target company at $3.9 billion.
Execution Risks
$Expedia (EXPE.US)$ shares plunged after online travel booking company announced a change in leadershipfollowing fourth quarter results that beat estimates. The company appointed Ariane Gorin as chief executive officer, effective May 13, succeeding Peter Kern, who will be vice chairman and a board member, Expedia said in press release Thursday afternoon, after releasing earnings results. Bank of America Securities downgraded the stock to neutral from buy, citing a soft bookings outlook and execution risks as the company transitions to a new CEO.
Challenging Macro
Shares of $Newell Brands (NWL.US)$ plunged Friday after the consumer goods company gave soft full-year outlook and acknowledged a "challenging macro-economic backdrop." That overshadowed the smaller-than-expected fourth-quarter loss and sales beat reported by the company.
- Luzi Ann Santos | moomoo News
Source: Bloomberg, Dow Jones, CNBC, Reuters
Disclaimer: This presentation is for informational and educational use only and is not a recommendation or endorsement of any particular investment or investment strategy. Indexes are unmanaged and cannot be directly invested into. Past performance is no indication of future results. Investing involves risk and the potential to lose principal. Investment information provided in this content is general in nature, strictly for illustrative purposes, and may not be appropriate for all investors. It is provided without respect to individual investors’ financial sophistication, financial situation, investment objectives, investing time horizon, or risk tolerance. You should consider the appropriateness of this information having regard to your relevant personal circumstances before making any investment decisions. Past investment performance does not indicate or guarantee future success. Returns will vary, and all investments carry risks, including loss of principal. Moomoo makes no representation or warranty as to its adequacy, completeness, accuracy or timeliness for any particular purpose of the above content. See this link for more information.
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