Wall Street continued its rally on Friday with record closing highs as the fourth-quarter earnings season started with solid results from banks and robust retail sales drove investor optimism about economic growth.
The S&P 500 and NASDAQ both registered their eight record closing highs out of the first nine trading days of this year, while the Dow boasted its sixth closing high of the year.
JPMorgan Chase & Co, the biggest US lender by assets, said a US tax overhaul would help profits by reducing its tax bill and stimulating more business. The bank’s shares rose 1.7 percent.
“The fact all the big money center banks beat on the bottom line is a good omen for the rest of the earnings season,” said William Lynch, director of investments at Hinsdale Associates, in Hinsdale, Illinois.
Investors were also hopeful that this year’s financial forecasts from US companies would beat Wall Street estimates, as many analysts might not have tax savings fully reflected in their models as the tax bill was signed into law so late last month.
“I don’t know how much of that is priced in right now,” San Francisco-based Wedbush Securities senior vice president Stephen Massocca said. “It seems like the economy is going OK, inflation is kind of nonexistent right now, wage growth is not an issue for most income statements, so what’s not to like here.”
Earnings for S&P 500 companies are expected to increase on an average by 12.1 percent in the quarter, with profit for financial services companies likely to increase 13.2 percent, according to Thomson Reuters I/B/E/S.
BlackRock Inc rose 3.3 percent. The world’s largest asset manager reported profit that beat estimates as investors flooded into the relatively low-cost funds.
While Wells Fargo & Co earnings beat expectations, its shares slipped 0.7 percent after it set aside US$3.25 billion in the fourth quarter of last year to cover legal expenses related to probes into its mortgage and sales practices.
The Dow Jones Industrial Average on Friday rose 228.46 points, or 0.89 percent, to 25,803.19, the S&P 500 gained 18.68 points, or 0.67 percent, to 2,786.24 and the NASDAQ Composite added 49.29 points, or 0.68 percent, to 7,261.06.
For the week, the S&P rose 1.6 percent, compared with the Dow’s 2 percent rise and a 1.8 percent advance in the NASDAQ.
The S&P consumer discretionary index on Friday jumped 1.3 percent after retail sales data showed households bought more goods, suggesting the US economy exited last year with strong momentum.
Amazon.com Inc rose 2.2 percent to breach US$1,300 for the first time. It closed at US$1,305.20.
The sector was also helped by a late-afternoon Bloomberg report that activist D.E. Shaw built a position in Lowe’s Companies Inc, sending its shares up 5.3 percent.
Bank stocks were helped by a rise in US Treasury yields after underlying US consumer prices for last month posted the biggest gain in 11 months, signaling a pickup in inflation.
The Treasury move helped push the utilities sector down 0.6 percent, making it the weakest performer of the S&P 500’s 11 sectors.
Advancing issues outnumbered declining ones on the New York Stock Exchange by a 1.17-to-1 ratio; on NASDAQ, a 1.54-to-1 ratio favored advancers.
The S&P 500 posted 164 new 52-week highs and 12 new lows; the NASDAQ Composite recorded 222 new highs and 14 new lows.
Volume so far on US exchanges was 6.88 billion shares, above the 6.39 billion average for the full session over the past 20 trading days.
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
Malaysia’s leader yesterday announced plans to build a massive semiconductor design park, aiming to boost the Southeast Asian nation’s role in the global chip industry. A prominent player in the semiconductor industry for decades, Malaysia accounts for an estimated 13 percent of global back-end manufacturing, according to German tech giant Bosch. Now it wants to go beyond production and emerge as a chip design powerhouse too, Malaysian Prime Minister Anwar Ibrahim said. “I am pleased to announce the largest IC (integrated circuit) Design Park in Southeast Asia, that will house world-class anchor tenants and collaborate with global companies such as Arm [Holdings PLC],”
Sales in the retail, and food and beverage sectors last month continued to rise, increasing 0.7 percent and 13.6 percent respectively from a year earlier, setting record highs for the month of March, the Ministry of Economic Affairs said yesterday. Sales in the wholesale sector also grew last month by 4.6 annually, mainly due to the business opportunities for emerging applications related to artificial intelligence (AI) and high-performance computing technologies, the ministry said in a report. The ministry forecast that retail, and food and beverage sales this month would retain their growth momentum as the former would benefit from Tomb Sweeping Day
Thousands of parents in Singapore are furious after a Cordlife Group Ltd (康盛人生集團), a major operator of cord blood banks in Asia, irreparably damaged their children’s samples through improper handling, with some now pursuing legal action. The ongoing case, one of the worst to hit the largely untested industry, has renewed concerns over companies marketing themselves to anxious parents with mostly unproven assurances. This has implications across the region, given Cordlife’s operations in Hong Kong, Macau, Indonesia, the Philippines and India. The parents paid for years to have their infants’ cord blood stored, with the understanding that the stem cells they contained