Tech giants lead stocks to big gains
Major stock indexes on Wall Street notched their biggest gains in more than six weeks Thursday, as technology companies clawed back some of the ground they had recently lost.
The Standard & Poor’s 500 rose 2.5%, with roughly 85% of the stocks in the benchmark index closing higher. The Dow Jones industrial average climbed 1.8%, and the tech-heavy Nasdaq composite ended 3.1% higher.
The gains erased weekly losses for the indexes, though they are all still headed for a dismal monthly finish after sliding for much of April.
This week has been especially turbulent as investors review a heavy batch of corporate earnings from major tech companies, industrial firms and retailers.
“Volatility is elevated across the board,” said Zach Hill, head of portfolio management at Horizon Investments. “We had some weakness last week and the beginning of this week, and we’re seeing some of that reverse.”
The S&P 500 rose 103.54 points to 4,287.50, while the Dow climbed 614.46 points to 33,916.39. The Nasdaq picked up 382.59 points to close at 12,871.53.
Smaller-company stocks also rallied. The Russell 2000 rose 33.91 points, or 1.8%, to 1,917.94.
Big tech and communications companies have been behind much of the oscillations in the broader market as their pricey stock values have more force in pushing the major indexes up or down.
Apple rose 4.5% in regular trading before reporting stronger-than-expected results and increasing its dividend and stock repurchase program.
Chipmaker Qualcomm jumped 9.7% after easily beating Wall Street’s profit estimates. Facebook parent company Meta Platforms surged 17.6%, the biggest gain among S&P 500 stocks, after it beat Wall Street’s first-quarter profit forecasts and reported an encouraging increase in daily users.
Favorable financial reports helped support gains for several other major companies. McDonald’s rose 2.9% after a strong earnings update. Southwest Airlines rose 2.1% after reporting solid revenue and telling investors it expects a profitable year as travel demand returns.
Amazon rose 4.7% in regular trading but slumped 10.5% in after-hours trading after the online retail giant reported its first quarterly loss since 2015. The company reported a decline in sales and a huge write-down of its investment in an electric vehicle startup.
Bond yields gained ground. The yield on the 10year Treasury rose to 2.83% from 2.81%.
The latest round of corporate report cards is hitting the market as Wall Street tries to figure out how inflation is affecting businesses and consumer spending.
Earnings have been mostly positive, but investors are also focusing on forecasts, which have become more difficult for many companies to provide because of all the uncertainties swirling around inflation and economic growth.
“Companies just don’t have enough transparency into the future to give any numbers on that,” said Jason Draho of UBS Global Wealth Management.
Supply chain issues have been crimping operations, and Russia’s war against Ukraine has pushed energy and food commodity prices higher. COVID-19 measures in China have added to concerns about growth.
Investors will get another update on consumer spending Friday when the Commerce Department releases its personal income and spending report for March.