Stocks end week with more records
NEW YORK >> Wall Street closed its latest winning week with more gains Friday, pushing U.S. stocks to new heights.
The S&P 500 rose 40.81 points, or 0.8%, to 5,137.08 a day after setting an all-time high. It’s been on a tremendous run and has climbed in 16 of the last 18 weeks because of excitement about cooling inflation and a mostly resilient U.S. economy.
The Dow Jones Industrial Average gained 90.99, or 0.2%, to 39,087.38. Technology stocks led the market, and the Nasdaq composite jumped 183.02, or 1.1%, to 16,274.94 a day after surpassing its prior record set in 2021.
In the bond market, Treasury yields eased after reports on manufacturing and sentiment among U.S. consumers came in softer than economists expected. They reinforced bets that the Federal Reserve may begin cutting interest rates in June, particularly after a report on Thursday showed a key measure of inflation behaved pretty much as expected last month.
Dell Technologies helped drive the stock market after jumping 31.6%. It reported stronger profit and revenue for the latest quarter than analysts expected, highlighting demand for its Ai-optimized servers.
A seemingly never-ending crescendo of demand for artificial-intelligence technology has helped catapult stocks higher over the last year. Dell has more than tripled in the last 12 months, while Nvidia has surged more than 260%.
Netapp leaped 18.2% after reporting stronger results than expected, saying it’s seeing “good momentum in AI.” The data company also gave a forecasted range for profit in the current quarter that topped what several analysts were expecting.
The mood was much more dour in the banking industry, where New York Community Bancorp tumbled 25.9%. It warned investors late Thursday that it found weakness in how it internally reviews loans, caused by ineffective oversight, risk assessment and monitoring activities.
The company said it won’t be able to file its annual report in time, and it took a charge worth $2.4 billion against its results for the last three months of 2023. Its CEO stepped down after 27 years with the company, effective immediately.
Much attention has been on smaller regional banks after last year’s crisis in the industry led to the collapses of several. One of them, Signature Bank, was swallowed up by NYCB, which has caused the resulting bank to face stricter oversight amid struggles for loans tied to real estate.
While NYCB faces many issues that are specific to it, the worry has been that banks across the industry face challenges from loans made for realestate projects.
They’re under pressure in part because the Federal Reserve has hiked its main interest rate to the highest level since 2001, which can squeeze the financial system. The hope has been that the Fed will cut interest rates several times this year to offer some relief for banks and the broader economy.
The Fed has indicated it may do so if inflation continues to cool decisively toward its 2% target. But a string of stronger reports on the economy than expected have made traders push back forecasts for when the cuts could begin. The hope now is that the Fed could start in June after traders shelved earlier expectations for March.
Hopes for a June cut built after a report showed the U.S. manufacturing industry shrank in February for a 16th straight month.