Wall Street powered higher by technology, Amazon results

NEW YORK — Wall Street climbed on Friday as a surge in the tech sector and a rally in Amazon shares helped push the Nasdaq to its best day in nearly a year.

The S&P technology index led the way higher, up 2.91%. The index notched its best day since March 1, 2016 and is up nearly 35% on the year versus the 15% gain in the S&P 500. Google-parent Alphabet gained 4.26% as its revenue got a boost from advertising sales. Microsoft jumped 6.41% after the world’s largest software company reported further gains from its cloud computing services. Also lifting the sector were shares of Apple, which rose 3.58% after the company allayed concerns of muted demand for its 10th anniversary phone. Intel soared 7.38% after its quarterly results topped estimates and the chipmaker raised its full-year forecasts. Amazon, up 13.22%, was responsible for the biggest boost to the S& P 500 after reporting a quarterly sales surge. Its gains helped lift the consumer discretionary sector 1.60% to its best daily performance since Dec. 7.

“Anyone who is drawing parallels to the tech bubble of 1999 has to at least consider that this rally in those large names is really fueled in large part by earnings, not just hope,” said Jack Ablin, chief investment officer at BMO Private Bank in Chicago.

“They are the ones that everyone wants to own, has to own because they are the ones reporting the best earnings. They definitely came through, that is very positive,” he added.

“There are certainly similarities between the tech bubble and now, but the underpinnings of this rally are still a lot more solid.”

Adding to positive sentiment was the third-quarter gross domestic product data that showed the US economy unexpectedly maintained a brisk pace of growth, at a three-percent annual rate, despite a hurricane-led drop in consumer spending and construction activities.

A report about President Donald Trump favoring Federal Reserve Governor Jerome Powell as the head of the US central bank — signaling continuation of current monetary policy — also provided a boost for stocks.

The Dow Jones Industrial Average rose 33.33 points or 0.14% to 23,434.19, the S&P 500 gained 20.67 points or 0.81% to 2,581.07 and the Nasdaq Composite added 144.49 points or 2.20% to 6,701.26. Advancing issues outnumbered declining ones on the NYSE by 1.62-to-1; on Nasdaq, a 1.70-to-1 ratio favored advancers. —