The S&P 500 closed above 5,000 for the first time on Friday and the NASDAQ briefly traded above 16,000, with boosts from megacaps and chip stocks, including Nvidia Corp as investors bet on artificial intelligence (AI) technology and eyed strong earnings data.
Nvidia finished up 3.6 percent and hit a record high after Reuters reported it was building a new business unit focused on designing bespoke chips for cloud computing firms and others, including advanced AI processors.
This was after the Wall Street Journal reported on Thursday that OpenAI chief executive officer Sam Altman was in talks with investors to raise funds for a tech initiative intended to boost chip-building capacity for power AI, among other things.
Photo: Bloomberg
“The AI story so far has been all about building the infrastructure, the chips, the data centers,” said David Lefkowitz, head of US equities at UBS Global Wealth Management, adding that the report “at least underscores that there’s potentially a tremendous amount of demand going forward for AI infrastructure.”
While Lefkowitz said the S&P and NASDAQ’s round number milestones likely would not change investors’ calculations of the market’s risk and reward prospects, he said “it raises the profile of what’s happening in the market.”
Along with outperformance by the Philadelphia semiconductor index, which closed up 1.99 percent, technology-focused market heavyweights including Microsoft Corp, Amazon.com Inc and Alphabet Inc also contributed to index gains.
With results from about two-thirds of S&P 500 companies, LSEG data now show Wall Street estimates for fourth-quarter earnings growth of 9.0 percent versus expectations for 4.7 percent growth on Jan. 1, while 81 percent of companies are beating estimates, compared with a 76 percent average in the previous four reporting periods.
“Earnings have been strong so far, above expectations,” said Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder in New York. “And there was news about additional growth opportunities for Nvidia specific to cloud computing, another growth area besides AI. Those are the big drivers.”
The Dow Jones Industrial Average fell 54.64 points, or 0.14 percent, to 38,671.69, the S&P 500 gained 28.70 points, or 0.57 percent, to 5,026.61 and the NASDAQ Composite gained 196.95 points, or 1.25 percent, to 15,990.66.
Positive earnings and the boost from AI optimism have helped the S&P 500 to notch 10 intraday record highs so far this year.
The NASDAQ closed just 0.4 percent below its 16,057.44 record closing high registered in November 2021.
For the week, all three indices registered their fifth straight weekly gain with the S&P adding 1.4 percent, the NASDAQ rising 2.3 percent and the Dow climbing 0.04 percent.
Earlier, data showed US monthly consumer prices rose less than initially estimated in December last year, but underlying inflation remained a tad warm — a mixed picture that clouded expectations on the timing of interest-rate cuts from the US Federal Reserve.
Strong economic data and hawkish comments from Fed policymakers in recent days have dashed hopes the central bank would start cutting interest rates next month.
Ghriskey points to Fed official predictions in the “dot-plot,” which still imply a rate cut this year.
“The market does have the Fed’s wind at its back. Seemingly we’ve reached the top of interest rates. The next move is going to down. We don’t know when that’s going to be. The Fed keeps throwing cold water on that idea but their votes with the dots say they’re going to be easing in the second half,” Ghriskey said.
Market participants are awaiting data on last month’s consumer prices next week for more clues on when the Fed will cut borrowing costs.
To many, Tatu City on the outskirts of Nairobi looks like a success. The first city entirely built by a private company to be operational in east Africa, with about 25,000 people living and working there, it accounts for about two-thirds of all foreign investment in Kenya. Its low-tax status has attracted more than 100 businesses including Heineken, coffee brand Dormans, and the biggest call-center and cold-chain transport firms in the region. However, to some local politicians, Tatu City has looked more like a target for extortion. A parade of governors have demanded land worth millions of dollars in exchange
Hong Kong authorities ramped up sales of the local dollar as the greenback’s slide threatened the foreign-exchange peg. The Hong Kong Monetary Authority (HKMA) sold a record HK$60.5 billion (US$7.8 billion) of the city’s currency, according to an alert sent on its Bloomberg page yesterday in Asia, after it tested the upper end of its trading band. That added to the HK$56.1 billion of sales versus the greenback since Friday. The rapid intervention signals efforts from the city’s authorities to limit the local currency’s moves within its HK$7.75 to HK$7.85 per US dollar trading band. Heavy sales of the local dollar by
Taiwan Semiconductor Manufacturing Co’s (TSMC, 台積電) revenue jumped 48 percent last month, underscoring how electronics firms scrambled to acquire essential components before global tariffs took effect. The main chipmaker for Apple Inc and Nvidia Corp reported monthly sales of NT$349.6 billion (US$11.6 billion). That compares with the average analysts’ estimate for a 38 percent rise in second-quarter revenue. US President Donald Trump’s trade war is prompting economists to retool GDP forecasts worldwide, casting doubt over the outlook for everything from iPhone demand to computing and datacenter construction. However, TSMC — a barometer for global tech spending given its central role in the
An Indonesian animated movie is smashing regional box office records and could be set for wider success as it prepares to open beyond the Southeast Asian archipelago’s silver screens. Jumbo — a film based on the adventures of main character, Don, a large orphaned Indonesian boy facing bullying at school — last month became the highest-grossing Southeast Asian animated film, raking in more than US$8 million. Released at the end of March to coincide with the Eid holidays after the Islamic fasting month of Ramadan, the movie has hit 8 million ticket sales, the third-highest in Indonesian cinema history, Film
RSS