Wall Street Surges, Driven by Tech Rebound

All three major stock indexes extended Friday’s rally as the day progressed. The tech-heavy Nasdaq was in front, boosted by a 4.9% jump in semiconductor shares.

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“This is a remarkable rally among a number of names that did poorly last year,” said Robert Pavlik, senior portfolio manager at Dakota Wealth in Fairfield, Connecticut. “Nobody wants to be seen on the sidelines with a bunch of cash as the market turns away from them.”

The session marks the calm before the storm in a week with the back-end loaded with high profile earnings reports and important economic data.

Read also: Wall Street slammed investment banking, as executives expect more confidence ahead

Investors are all but certain the Federal Reserve is about to implement a bite-sized interest rate hike next week as the US central bank remains committed to preventing the hottest inflation cycle in decades.

Financial markets have priced in a 99.8% probability of a 25 basis point increase in the Fed funds target rate at the conclusion of its two-day monetary policy meeting next Wednesday, according to CME’s FedWatch tool.

Read also: Wall Street believes the euro rally has just begun

The Dow Jones Industrial Average rose 328.17 points, or 0.98%, to 33,703.66, the S&P 500 rose 55.93 points, or 1.41%, to 4,028.54 and the Nasdaq Composite rose 232.84 points, or 2.09%, to 11,373.28.

All 11 major sectors in the S&P 500 were higher, with technology jumping the most at 2.8%.

The fourth quarter reporting season is in full swing with 57 companies in the S&P 500 posting results. According to Refinitiv, 63% of them outperformed expectations.

Analysts now see the S&P 500’s fourth-quarter earnings overall falling 3% year-over-year, nearly double the 1.6% annual decline seen at the start of the year, according to Refinitiv.

This week, heavyweight industrialists including Microsoft Corp and Tesla Inc, Boeing CO, 3M Co, Union Pacific Corp Dow Inc, Northrop Grumman Corp are expected to post quarterly results, along with others.

Tesla Inc rose 7.8% as Chief Executive Elon Musk took the stand in his fraud lawsuit related to a tweet saying he supported taking the electric automaker private.

Baker Hughes Company missed quarterly profit estimates due to inflationary pressures and ongoing disruptions due to Russia’s war on Ukraine. Shares of Oilfield Services Company were down 0.9%.

Cloud-based software firm Salesforce Inc jumped 3.1% after news that activist investor Elliott Management Corp has taken a multibillion-dollar stake in the company.

Spotify Technology SA joins a growing list of tech-related companies announcing impending job cuts, shedding 6% of its workforce as rising interest rates and the growing prospect of a recession weigh on growth stocks. But the pressure is on. Shares of the music streaming company rose 2.1%.

On the economic front, the Commerce Department is expected on Thursday to take its preliminary “advance” on fourth-quarter GDP, which analysts expect to land at 2.5%.

On Friday, the comprehensive Personal Consumption Expenditure (PCE) report is due to shed light on consumer spending, income growth and importantly, inflation.

Forward issues declined in the ratio of 3.53-to-1 on the NYSE; On the Nasdaq, the 1.95-to-1 ratio was in favor of the advancers.

The S&P 500 posted 11 new 52-week highs and no new lows; The Nasdaq Composite recorded 66 new highs and 14 new lows.

The text of this story is published from a wire agency feed without any modification.