S&P 500 and Nasdaq Composite Rest Near Record Highs

Barry Adams
08 Feb, 2024
New York City

Stock market indexes rested on Wall Street after extending weekly and monthly gains in the previous session.

The S&P 500 index and the Nasdaq Composite flirted with near-record highs as investors focused beyond lingering interest rate uncertainty.

Despite the ongoing debate about the future rate path and levels, the U.S. economy is expanding at a steady clip of more than 2%, and the job market has added 255,000 monthly jobs over the last year.

Moreover, inflation has been falling steadily from a high of 9% to near 3%, keeping consumer spending growth intact, driven in part by wage increases.

With the positive economic backdrop and resilient consumer and labor markets, corporate earnings have been largely ahead of market expectations for the second year in a row.

 

U.S. indexes and yields

The S&P 500 index decreased 0.2% to 4,945.02, and the Nasdaq Composite fell 0.2% to 15,725.56.

The yield on 2-year Treasury notes increased to 4.43%, 10-year Treasury notes rose to 4.13%, and 30-year Treasury bonds edged up to 4.35%.

WTI crude oil increased $0.93 to $74.79 a barrel, and natural gas prices were nearly unchanged at $1.98 a thermal unit.

Gold decreased by $10.93 to $2,023.20 an ounce and extended the previous week's gains after the U.S. dollar gained in international trading.

The dollar index, which weighs the U.S. dollar against a basket of foreign currencies, edged lower to 104.34.

 

U.S. Stock Movers

Walt Disney Co. soared 7.9% to $107.0 after the media and entertainment company reported better-than-expected revenue, earnings, and full-year outlook.

The media company announced a $1.5 billion stake in Epic Games, the creator and developer of Fortnite.

Disney confirmed that the company is on track to launch its ESPN streaming service in 2025.

The company also said it is on track to cut $7.5 billion in costs by the end of fiscal 2024.

PayPal Holdings declined 9.5% to $57.35 after the payments services provider estimated weaker-than-estimated earnings in the first quarter and full year.

However, the company reported fourth-quarter results that were ahead of consensus estimates.

Spirit Airlines jumped 4.2% to $7.24 after the deep discount airline reported better-than-expected quarterly results.

Revenue in the fourth quarter declined to $1.32 billion from $1.39 billion, net loss shrank 32% to $183.6 million from $1270.6 million, and diluted loss per share fell to $1.68 from $2.49 a year ago.

Total revenue per passenger flight segment declined 15.3% to $114.84, driven by a 25% decrease in fare revenue to 48.24 and a 6.6% fall in non-ticket revenue to $66.60.

Arm Holdings soared 27.9% to $98.45 after the advanced chip designer reported sharply higher revenue and earnings in its latest quarter.

The UK-based chipmaker reported fiscal third quarter revenue rose 14% to $824 million from $724 million, net income fell 52% to $87 million from $184 million, and diluted earnings per share decreased to 8 cents from 18 cents a year ago.

The company exceeded its fiscal third-quarter revenue estimate of between $720 million and $800 million.

The company estimated fiscal fourth quarter revenue between $850 million and $900 million and lifted its full-year revenue estimate range to between $3.155 billion and $3.205 million from the previous range between $2.96 billion and $3.08 billion.