Another bumpy ride on Wall Street ended on Friday, as Amazon.com Inc’s positive earnings capped a run of mixed big-tech numbers, with the NASDAQ recovering much of its losses from the previous session and all three benchmarks ending the week in positive territory.
Results from megacap growth stocks have dictated market moves this week, as investors seek out tangible data to support sky-high valuations.
Amazon jumped 13.5 percent after reporting robust earnings in the holiday quarter. The gain expanded its market capitalization by about US$190 billion, the largest ever single-day increase in value of a US company.
This came a day after Facebook owner Meta Platforms Inc’s disappointing results shook markets and wiped more than US$200 billion off its valuation, the worst loss of stock market value in history by a US company.
“These are eye-watering, stomach churning moves normally associated with penny stocks, and yet they are happening in companies with billion-dollar market caps,” CMC Markets UK chief market analyst Michael Hewson said.
Despite the earnings-driven whiplash in technology stocks, all three major stock indices ended their first week of the month higher, with the Dow gaining 1.05 percent, the S&P 500 rising 1.55 percent and the NASDAQ increasing 2.38 percent. The indices posted their second week of gains in a row.
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While Meta lost another 0.3 percent on Friday, other social media companies which had been dragged down with the Facebook owner rebounded strongly as they posted estimate-beating earnings of their own.
Among them was Snap Inc, surging 58.8 percent after reporting better-than-expected fourth-quarter user growth and outlook.
On Friday, the Dow Jones Industrial Average fell 21.42 points, or 0.06 percent, to 35,089.74, the S&P 500 gained 23.09 points, or 0.52 percent, to 4,500.53 and the NASDAQ Composite added 219.19 points, or 1.58 percent, to 14,098.01.
Among the major S&P 500 sectors that advanced, energy stocks hit their highest since 2018 as crude prices touched a seven-year peak.
Hess Corp was the largest gainer in the sector, jumping 4 percent to its highest close since September 2014, while Occidental Petroleum Corp gained 2 percent, with its shares ending at levels last seen in February 2020.
Consumer discretionary was the leading sector, up 3.7 percent as it was bolstered by Amazon’s performance. The tech behemoth’s gains helped alleviate the drag of Ford Motor Co, which slumped 9.7 percent after the automaker posted disappointing quarterly figures.
The US Department of Labor’s closely watched employment report showed that nonfarm payrolls increased by 467,000 jobs last month, compared with the addition of 150,000 jobs forecast by economists polled by Reuters.
The data for December last year was revised higher to show that 510,000 jobs were created, instead of the previously reported 199,000.
Fears of faster-than-expected rate hikes to curb a surge in inflation have haunted markets since the beginning of the year, with growth stocks such as technology feeling the brunt of that, as investors pivot toward current cash flow from betting on future expectations.
“A lot of the high-valuation stuff is going to continue to have trouble and it’s already gotten smacked down a lot,” said Louis Ricci, head of trading at Emles Advisors. “To us, this jobs report was affirmation that, yes, stocks are going to be jittery and there’s going to be a lot of volatility.”
Nvidia Corp’s demand for advanced packaging from Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) remains strong though the kind of technology it needs is changing, Nvidia CEO Jensen Huang (黃仁勳) said yesterday, after he was asked whether the company was cutting orders. Nvidia’s most advanced artificial intelligence (AI) chip, Blackwell, consists of multiple chips glued together using a complex chip-on-wafer-on-substrate (CoWoS) advanced packaging technology offered by TSMC, Nvidia’s main contract chipmaker. “As we move into Blackwell, we will use largely CoWoS-L. Of course, we’re still manufacturing Hopper, and Hopper will use CowoS-S. We will also transition the CoWoS-S capacity to CoWos-L,” Huang said
Nvidia Corp CEO Jensen Huang (黃仁勳) is expected to miss the inauguration of US president-elect Donald Trump on Monday, bucking a trend among high-profile US technology leaders. Huang is visiting East Asia this week, as he typically does around the time of the Lunar New Year, a person familiar with the situation said. He has never previously attended a US presidential inauguration, said the person, who asked not to be identified, because the plans have not been announced. That makes Nvidia an exception among the most valuable technology companies, most of which are sending cofounders or CEOs to the event. That includes
INDUSTRY LEADER: TSMC aims to continue outperforming the industry’s growth and makes 2025 another strong growth year, chairman and CEO C.C. Wei says Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), a major chip supplier to Nvidia Corp and Apple Inc, yesterday said it aims to grow revenue by about 25 percent this year, driven by robust demand for artificial intelligence (AI) chips. That means TSMC would continue to outpace the foundry industry’s 10 percent annual growth this year based on the chipmaker’s estimate. The chipmaker expects revenue from AI-related chips to double this year, extending a three-fold increase last year. The growth would quicken over the next five years at a compound annual growth rate of 45 percent, fueled by strong demand for the high-performance computing
TARIFF TRADE-OFF: Machinery exports to China dropped after Beijing ended its tariff reductions in June, while potential new tariffs fueled ‘front-loaded’ orders to the US The nation’s machinery exports to the US amounted to US$7.19 billion last year, surpassing the US$6.86 billion to China to become the largest export destination for the local machinery industry, the Taiwan Association of Machinery Industry (TAMI, 台灣機械公會) said in a report on Jan. 10. It came as some manufacturers brought forward or “front-loaded” US-bound shipments as required by customers ahead of potential tariffs imposed by the new US administration, the association said. During his campaign, US president-elect Donald Trump threatened tariffs of as high as 60 percent on Chinese goods and 10 percent to 20 percent on imports from other countries.
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