S&P 500 hits intraday record amid strong earnings surge

The S&P 500 rose Wednesday and edged closer to the 5,000 level, notching a closing high as investors parsed through another slate of quarterly results that signalled a flourishing economy.

The broad-based index, which first breached the 4,000 level in April 2021, added 0.82 per cent to finish at 4,995.06. At session highs, the S&P hit 4,999.89.

The Nasdaq Composite jumped 0.95 per cent to settle at 15,756.64, while the Dow Jones Industrial Average rallied 156 points, or 0.4 per cent, to close at 38,677.36 and an all-time high.

Stocks rallied as investors weighed a fresh batch of strong corporate profits and major technology behemoths continued their march higher. Microsoft climbed about 2 per cent to trade at fresh highs, while Meta Platforms surged 3.3 per cent. Alphabet and Amazon rose about 1 per cent each.

Enphase Energy popped about 17 per cent after the solar company said its inventory glut may be nearing a bottom, boosting other solar stocks in sympathy. Ford gained 6 per cent after beating Wall Street’s fourth-quarter estimates and issuing higher-than-expected guidance, while Chipotle Mexican Grill climbed 7 per cent on strong earnings and traffic.

Nvidia’s price has grown by 2 per cent, propelled by Wall Street's optimism regarding artificial intelligence, is poised to surpass Amazon's market capitalisation for the first time in two decades, closing in on Google-owner Alphabet's value as well. With a 40 per cent surge in 2024 and an elevated market capitalisation of US$1.715 trillion, Nvidia's position as the fifth most valuable US company underscores its pivotal role in meeting the escalating demand for AI technology across various sectors, bolstered by partnerships with tech giants like Meta Platforms.

Saudi Aramco has a $US2-trillion market capitalisation, making it the world’s third most valuable publicly listed company, according to LSEG data. However, over 90 per cent of that company is closely held by the government of Saudi Arabia and less than 2 per cent of its shares are available for trading by investors.

After the bell, Walt Disney reported quarterly results. The company exceeded earnings expectations with adjusted EPS of $1.22 and revenue of $23.55 billion, while raising its fiscal 2024 guidance to $4.60 per share. Despite a decline in Disney+ subscribers due to price hikes, average revenue per user increased.

A better-than-expected earnings season, coupled with upbeat guidance, has been a source of strength for the market in recent weeks, illustrating that consumer spending is healthy and that the economy remains resilient in the face of high interest rates.

The advance comes despite a recent retreat in 2024 rate expectations following cautious commentary from the central bank. Fed Chair Jerome Powell signalled last week that investors will have to wait longer than previously thought for a pivot, while Minneapolis Federal Reserve President said Wednesday that he anticipates only two to three rate cuts this year.

Turning to US sectors, all closed higher overnight except for Real Estate and Consumer Staples. Information Technology was the best performer.

Futures

The SPI futures are pointing to a flat start.

Currency

One Australian dollar at 8.55am was buying 65.21 US cents.

Commodities

Gold lost 0.05 per cent. Silver fell 0.86 per cent. Copper lost 1.19 per cent. Oil gained 1.04 per cent.

Figures around the globe

European markets closed lower. London’s FTSE fell 0.68 per cent, Frankfurt lost 0.65 per cent, and Paris closed 0.36 per cent lower.

Turning to Asian markets, Tokyo’s Nikkei fell 0.11 per cent, Hong Kong’s Hang Seng lost 0.34 per cent and China’s Shanghai Composite gained 1.44 per cent higher.

Yesterday, the Australian share market closed 0.45 per cent higher at 7,615.84

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Sources: Bloomberg, FactSet, IRESS, TradingView, UBS, Bourse Data, Trading Economics, CoinMarketCap.

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