Shares rose on Friday despite a tumble in Amazon shares after economic data pointed to slowing inflation and stable consumption.
The Dow Jones Industrial Average closed at 828.52 points, or around 2.6%, up at 32,861.80. The S&P 500 added almost 2.5%, to close at 3,901.06. The Nasdaq Composite ended up around 2.9%, closing at 11,102.45.
On a weekly basis, the major indices made notable gains. It was the fourth consecutive positive week for the Dow Jones, the first since a five-week streak ending in November 2021. The 30-stock index is up 5.7% this week in its best performance since may. It’s also on track for its best month since January 1976.
The S&P 500 and Nasdaq are up 3.9% and 2.2%, respectively, on the week.
The stock market fractured this week as investors dumped tech stocks following weak earnings and outlook from Microsoft, Alphabet and Meta and turned to economically sensitive stocks that will benefit if the US economy can head off. a recession.
At the same time, investors found hope in data released during the week indicating that inflation could ease, increasing optimism that the Federal Reserve could break its 75% rate hike trend. basis points after the November meeting.
“The inflation data really wasn’t that bad. Earnings weren’t great, but not terrible,” said Megan Horneman, chief investment officer at Verdence. “When you have that middle of the road, it helps stock markets.”
Amazon plunged 6.8% after the company published lower-than-expected quarterly revenue and issued a disappointing fourth-quarter sales forecast on Thursday. Apple shares ended Friday up 7.5%. The tech giant announced iPhone revenue weaker than expected Thursday, but beat Wall Street estimates for quarterly earnings and revenue.
Apple and other better performers like Intel have given investors a foothold in what some see as a particularly tumultuous tech sector, subsequently putting upward pressure on the tech-heavy Nasdaq, a said Jay Hatfield, CEO of Infrastructure Capital Management. He said the market was also boosted by oil giants Chevron and Exxon Mobil, up around 1.2% and 2.9%, respectively, after the two said they beat expectations before the bell.
“Apple is really the only star, if you will, of mega-cap tech stocks,” Hatfield said. “It’s just a single market where bad is terrible, but OK is good, so on a relative basis it’s spectacular.”
The market picked up again after the basic personal consumption expenditure price index in September was up 0.5% from the previous month and 5.1% from a year ago, still high but generally in line with expectations. This is the Federal Reserve’s favorite inflation indicator. Personal spending rose 0.6%, more than expected, the data showed.