US stock indices on Friday advanced after robust earnings updates from ExxonMobil Corp and Intel Corp offset worries over Amazon.com Inc’s slowdown warning, while economic data reinforced expectations that the US Federal Reserve would hike interest rates next week.
Exxon shares finished up 1.3 percent after hitting an all-time high as the oil company reported a record first-quarter profit on rising oil and gas output, also boosting the S&P energy index 1.5 percent.
Chipmaker Intel gained 4 percent after it said gross margins would improve in the second half.
Yet Amazon fell 4 percent in its biggest one-day loss since early February, despite better-than-expected quarterly results, as it signaled its cloud computing business growth would slow further. It weighed on the consumer discretionary index, which finished down 0.04 percent.
After the market close, First Republic Bank tumbled 49 percent to US$1.77 after reports that the regional lender was headed for receivership. That was after the bank’s 43 percent decline in the regular trading session.
The benchmark S&P 500 advanced for the week as well as the day and registered a second consecutive monthly gain. It was helped by better-than-expected earnings from megacap companies including Alphabet Inc, Microsoft Corp and Meta Platforms Inc.
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“This week’s earnings overall were better than people expected. There was a lot of pessimism going in, but the past week has brought home the fact that it’s not turning into a bad earnings season at all,” said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia.
He said that investors might still be cautious ahead of Apple Inc’s results due next week, and the US Federal Open Market Committee meeting and the US jobs report for this month.
The Dow Jones Industrial Average rose 272 points, or 0.8 percent, to 34,098.16, the S&P 500 gained 34.13 points, or 0.83 percent, to 4,169.48, and the NASDAQ Composite added 84.35 points, or 0.69 percent, to 12,226.58.
The CBOE Volatility Index, otherwise known as “Wall Street’s fear gauge,” closed down 1.25 points at 15.78, which was its lowest close since Nov. 2021.
For the month the S&P rose 1.46 percent, while the Dow added 2.48 percent and the NASDAQ gained 0.04 percent. For the week the S&P rose 0.89 percent in line with the Dow’s weekly gain of 0.86 percent and the NASDAQ rose 1.28 percent.
Among the S&P 500’s 11 industry sectors the biggest gainer was energy, while the biggest decliner was utilities, which fell 0.2 percent.
The economically sensitive Dow Transportation index closed up 1.6 percent for the day, but lost 2.7 percent for the week.
Analysts expect first-quarter earnings for S&P 500 companies to fall 1.9 percent from a year earlier, compared with a 5.1 percent fall expected at the start of this month, Refinitiv data showed.
John Praveen, cochief investment officer at Paleo Leon Inc in Princeton, New Jersey, said that Friday’s economic data solidified expectations ahead of next week’s Fed meeting and eased fears about a sharp slowdown.
Data showed that US consumer spending was unchanged last month, while underlying inflation pressures remained strong, feeding expectations that the Fed would hike interest rates by 25 basis points next week.
Other data showed that first-quarter US economic growth slowed more than expected, while plunging consumer confidence this month heightened fears of a recession.
The Fed also issued a detailed and scathing assessment of its failure to identify problems and push for fixes at Silicon Valley Bank before the US lender’s collapse, and promised tougher supervision and stricter rules for banks.
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
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