Tech Stocks Boost Nasdaq, S&P 500; Netflix soars after results

The tech-heavy S&P 500 and Nasdaq gained ground on Friday, boosted by tech stocks, while Netflix rose after beating subscriber growth estimates.

Netflix shares rose 10.2% to a record high after the streaming giant beat Wall Street estimates for subscriber additions and said it expected continued growth through the end of the year.

The Dow Jones was dragged down by American Express, which lost 3.6% after its quarterly revenue missed estimates.

Meanwhile, all of the so-called Magnificent Seven stocks, which have fueled much of Wall Street’s rally this year, rose.

Apple gained 1.2% after data showed a sharp rise in new iPhone sales in China, while chip heavyweight Nvidia added 0.6% after BofA Global Research raised its price target on the stock.

Netflix earnings boosted the Communication Services sector 1%, while Information Technology rose 0.4%

An upbeat start to the quarterly earnings season and broadly positive economic data have put all three major indexes on track to post their sixth consecutive week of gains.

However, inflated valuations (the S&P 500 trades at nearly 22 times forward earnings), coupled with high expectations for corporate results and potential volatility around the US presidential election in November, could leave stocks vulnerable to a downturn. recoil.

“We had some good earnings from Netflix this morning, some good property data and overall sentiment has been pretty good,” said Dustin Thackeray, chief investment officer at Crewe Advisors.

“Now maybe it’s a waiting game to see how things develop (with the upcoming US election) and then the next Federal Reserve meeting a couple of days later, to see if there is some kind of pause in the next meetings during the remainder of the year.”

The Dow Jones Industrial Average fell 39.97 points, or 0.09%, to 43,199.96, the S&P 500 gained 15.92 points, or 0.27%, to 5,857.39, and the Nasdaq Composite gained 95. .02 points, or 0.52%, to 18,468.63.

The small-cap Russell 2000 was expected to outperform the major indexes for the week with a weekly gain of 2%, although it was down 0.1% on the day.

CVS Health fell 9.3% after replacing CEO Karen Lynch with company veteran David Joyner and withdrawing its profit forecast for 2024. It was the biggest drop in the benchmark index.

SLB fell 3.2% after the results, while Procter & Gamble rose 0.1%.

Meanwhile, U.S. shares of Chinese companies rose after China’s central bank launched financing plans aimed at boosting the stock market. Alibaba gained 1.7% and JD.com rose 2.2%.

Expectations that the US Federal Reserve will cut interest rates by 25 basis points at its November meeting remained intact, at around 90%, according to CME’s FedWatch.

In economic data, single-family home construction rose 2.7% to a seasonally adjusted annual rate of 1.027 million units in September.

Issues that rose exceeded those that fell by a ratio of 1.41 to 1 on the New York Stock Exchange and 1.32 to 1 on the Nasdaq.

The S&P 500 posted 42 new 52-week highs and two new lows, while the Nasdaq Composite posted 109 new highs and 27 new lows.

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