Tech Rally Powers Nasdaq and S&P 500 Higher

Barry Adams
24 Jan, 2024
New York City

Tech stocks pointed higher and extended weekly gains, and investors reviewed the latest batch of earnings.

The S&P 500 index and the Nasdaq Composite advanced more than 0.5% in Wednesday's trading after Netflix reported sharply higher net subscriber additions.

Mega-cap tech stocks Alphabet, Apple, Amazon, Meta, Microsoft, and Netflix advanced in early trading.

Dupont de Nemours plunged 12.5% to $65.34 after the chemical company reported weak fourth-quarter results and issued a weak outlook for the current quarter.

eBay increased 3.8% to $43.0 after the online marketplace operator announced its plan to lay off 9% of its workforce, or about 1,000 jobs, over the next several months.

Crude oil traded volatile in international markets, and shipping companies continue to avoid Red Sea Lanes amid ongoing Houthi rebel attacks in the region.

The Houthi attacks are impacting India's petroleum product shipments; about 25% of all fuel exports are destined for Europe via the Red Sea lanes.

Shipping companies have rerouted most of the container ships from the region along the coast of South Africa, increasing cost and shipping time.

The container ship rate from Shanghai to Rotterdam surged more than 80% from a year ago at the end of the last week to $3,777 per 40-foot container.

The average composite index for the year-to-date is $3,173 for a 40-foot container, $495 higher than the 10-year average rate of $2,678, according to Drewry's World Container Index.

 

U.S. Indexes and Yields

The S&P 500 index increased 0.6% to 4,923.15, and the Nasdaq Composite rose 0.9% to 15,575.48.

The yield on 2-year Treasury notes decreased to 4.31%. 10-year Treasury notes declined to 4.10%, and 30-year Treasury bonds edged down to 4.30%.

WTI crude oil increased $0.34 to $74.76 a barrel, and natural gas prices increased 8 cents to $2.53 a thermal unit.

Gold increased by $4.61 to $2,033.34 an ounce and extended this week's gains after the U.S. dollar drifted slightly lower in international trading.

The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 102.97.

 

U.S. Stock Movers

Texas Instruments declined 3% to $168.90 after the company estimated weaker-than-expected revenue and earnings in the first quarter.

The technology company estimated revenue in a range of $3.45 billion to $3.75 billion and earnings per share between 96 cents and $1.16.

Revenue in the fourth quarter declined 13% to $4.0 billion from $4.7 billion, net income plunged 30% to $1.4 billion from $1.97 billion, and diluted earnings per share fell to $1.49 from $2.13 a year ago.

Netflix soared 10.2% to $542.25 after the streaming service provider reported higher-than-expected quarterly revenue and earnings.

Moreover, the company added 13.1 million net new subscribers, increasing the total to 260.8 million paid subscribers, an all-time high.

Revenue in the fourth quarter increased 12.5% to $8.8 billion from $8.5 billion, net income advanced to $938 million from $55 million, and diluted earnings per share rose to $3.73 from 12 cents a year ago.

The company guided a first-quarter revenue increase of 13.2% to $9.2 billion, net income of $1.97 billion, and diluted earnings per share of $4.49.

Alibaba Group Holding gained 2.2% to $75.63 after company insiders acquired additional stakes in the China-based e-commerce giant.

Chairman Joe Tsai acquired $151 million of its U.S.-listed shares in the last quarter, according to a SEC filing on January 22.

Co-founder Jack Ma acquired $50 million of the company's Hong Kong-listed stock, according to leading stock brokers in Hong Kong.

The news about the insider's purchase was first reported by the New York Times.

AT&T Inc. declined 3.2% to $16.62 after the telecom company reported weaker-than-expected quarterly results.