The New York Stock Exchange was trading in the green on Friday, with the S&P 500 near a new historic record, ending a week that started poorly after investors expressed doubts about the Fed's rate cuts.
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At around 3:30 p.m., the Dow Jones index was up 1.06% and the tech-dominated Nasdaq was up 1.56%. The broader S&P 500 index gained 1.18%, if this trend continues the S&P 500 will end the day with a record.
The day before, Wall Street had made up for the losses at the start of the week, but the market remained hesitant.
The Dow Jones rose 0.54% to 37,468.61 points, the Nasdaq index rose 1.35% to 15,055.65 points and the broader S&P 500 index gained 0.88% to 4,790.94 points.
Large-cap technology stocks continued the upward move that began Thursday “as semiconductor names led the market,” noted Art Hogan of B. Riley Wealth Management.
Nvidia, whose chips are in demand for artificial intelligence functions, rose 1.19%.
“Mark Zuckerberg, the head of Meta, posted a message on Instagram in which he reiterated that his group would buy components for AI, specifically 350,000 chips from Nvidia, by the end of the year,” noted Briefing.com's Patrick O'Hare . Meta gained 1.54%.
The positive momentum was also supported by positive reactions to several earnings reports, such as that of Dow Jones insurer Travelers, which gained 5.72%.
Its quarterly profit rose to $3 billion from $2.8 billion in 2022 thanks to a sharp increase in the prices of its insurance premiums (+21% for residential real estate).
After the American courts rejected the proposed merger between low-cost airlines JetBlue and Spirit Airlines, the alleged buyer JetBlue sold 3.96%. Shares of Spirit, which have halved since the takeover rejection, rallied 20% to $6.80.
Spirit also announced that its revenue for the latest quarter would be “at the upper end of the guidance range,” noting that “bookings were strong for peak travel seasons, namely Christmas and New Year's.”
Sandals from German brand Birkenstock, which went public last October, slipped 2.73% after falling more than 7% the day before. The market was disappointed with the shoe maker's sales forecasts for 2024.
Among macroeconomic data, the recent release of the University of Michigan Consumer Confidence Index surprised with its optimism.
At 78.8 points, the barometer climbed to its highest level since July 2021 in January, 13% more than in December. Analysts expected a slight decline.
“The economic data for 2024 contains much more good news than bad as inflation slows. All of this better-than-expected data is causing rate cut expectations to adjust,” recalls Art Hogan of B. Riley Wealth Management.
Bond yields, which had fallen ahead of the release of this new sign of continued buoyant American economic activity, rose to 4.18% for 10-year bonds, compared with 4.14% the previous day.
And the stock market indices, which were stronger at the beginning, slowed their progress after this index.
At the same time, residential property resales fell in December (-1%), while analysts expected a smaller decline.