Wall Street Sets New Record High Amid Earnings and Rate Outlook
Market Overview
Wall Street saw gains on Wednesday, with the benchmark reaching a new record high. Investors were focusing on major corporate earnings and monitoring policymakers’ remarks for more clues on the interest-rate cut outlook.
Corporate Earnings Impact
Ford Motor surged 4.5% to a six-month high, propelling consumer discretionary to lead the 11 S&P 500 sectors. The automaker announced an increase in first-quarter dividend and plans to scale back investments in new capacity for loss-making electric vehicles. General Motors also saw a 1.7% increase.
Technology Sector Performance
Snap slumped 32% to a two-month low after missing quarterly revenue estimates. Meanwhile, Uber Technologies forecasted quarterly core profit and gross bookings above estimates, but its shares were down 1.4%. Fortinet jumped 3.3% on a fourth-quarter profit beat, while U.S.-listed shares of Alibaba Group Holding lost 3.9% following downbeat quarterly revenue.
Analyst Insights
According to Robert Pavlik, senior portfolio manager at Dakota Wealth, earnings have come in slightly better than expected, with 81.2% of S&P 500 companies surpassing expectations. This has led to a rise of 8.1% in fourth-quarter earnings from the year-ago quarter.
Market Outlook
The benchmark S&P 500 reached another all-time high, driven by resilient earnings and optimism around potential rate cuts this year. While Chair Jerome Powell has ruled out a March rate reduction, traders are awaiting fresh clues from central bankers on the timing of the policy easing.
Stock Market Statistics
At 9:51 a.m. ET, the Dow Jones Industrial Average was up 98.72 points, the S&P 500 was up 21.59 points, and the Nasdaq was up 70.17 points. Declining issues outnumbered advancers on the NYSE and the Nasdaq.
Stock Performance
New York Community Bancorp lost 9.6%, while Roblox jumped 11.7% after forecasting strong annual bookings. Gilead Sciences lost 3.4% as fourth-quarter revenue dipped 4%, and VF Corp shed 10.6% after missing expectations for third-quarter results. Enphase Energy surged 15% as the solar inverter maker expects inventory levels to normalize.
Market Records
The S&P index recorded 41 new 52-week highs and two new lows, while the Nasdaq recorded 50 new highs and 49 new lows.
