U.S. stocks climb with S&P 500 on track for record close

United States

U.S. stocks pushed higher on Friday, putting the S&P 500 index within the range of what would be its first record closing high in two years, FactSet data show.

How are stocks trading?

  • The S&P 500 SPX rose 22 points, or 0.5%, to 4,803.
  • The Dow Jones Industrial Average DJIA gained 152 points, or 0.4%, to 37,616.
  • The Nasdaq Composite COMP advanced 91 points, or 0.6%, to 15,147.

On Thursday, the S&P 500 rose 41.73 points, or 0.9%, to end at 4,780.94, and the Dow industrials rose 201.94 points, or 0.5%, to finish at 37,468.61, ending a three-day losing streak. Meanwhile, the Nasdaq Composite surged 200.03 points, or nearly 1.4%, to 15,055.65.

What’s driving markets

U.S. stocks saw a modest pop at the open after the S&P 500 finished Thursday’s session within 0.3% of its record closing high of 4,796.56, reached Jan. 3, 2022.

Technology stocks are giving the market a boost once again on Friday as that corner of the market continued to outperform. Gains from members of the Magnificent Seven group of megacap technology stocks, along with a handful of others, helped put the tech-heavy Nasdaq-100 index on track for a second straight record close on Friday.

The Invesco QQQ Trust Series 1 QQQ, an ETF that tracks the Nasdaq-100, was trading above $ 415, according to FactSet data.

The index was helped along by gains from chipmakers like Nvidia Corp. NVDA, +1.91% and Broadcom Inc. AVGO, +2.96%, spurred by signs of more strength in the semiconductor space. Better-than-expected results from chip-making giant Taiwan Semiconductor Manufacturing Co. TSM, +0.26% on Thursday helped drive a powerful session for the Nasdaq Composite. And semis were getting another boost of life Friday from the latest sales guidance released by Super Micro Computer Inc. SMCI, +30.25%

“Basically, the Nasdaq is leading the way again, it looks like we’re at new highs here, the rally that started yesterday might have some legs,” said Peter Cardillo, chief market economist at Spartan Capital Securities.

“If earnings hold up and guidance is within expectations, then I think the rally can continue.”

As for Friday’s economic data, Cardillo noted that the preliminary reading on the University of Michigan’s consumer sentiment gauge for January showed a notable improvement.

The preliminary reading of the sentiment survey shot up to 78.8 from 69.7 in December. It was the highest reading on the gauge since July 2021.

Meanwhile, existing-home sales for December came in roughly in line with expectations, falling 1% to 3.78 million homes sold.

Markets entered 2024 with expectations for six or seven interest-rate cuts by the Federal Reserve. Those expectations have seen pushback, especially given strong economic data, such as retail-sales data, reported earlier this week.

On Friday, Cardillo suggested that a pop in Treasury yields since the market opened was helping to limit stocks’ gains. The yield on the 10-year note BX:TMUBMUSD10Y was up 4 basis points at 4.18%, according to FactSet data.

A number of Federal Reserve officials are speaking publicly on Friday, including Chicago Fed President Austan Goolsbee, who sat for an interview on CNBC at 8:30 a.m.

Goolsbee declined to say when he thinks the Fed will start cutting interest rates. But he did say reductions could be expected this year “if we continue to make surprising progress on inflation.”

“We don’t want to commit ourselves before the job is done,” Goolsbee said. But “as inflation comes down, that opens the door to a reduction in restrictiveness.”

See: Goolsbee says it’s too soon to determine when Fed will cut interest rates

Fed Vice Chair for Supervision Michael Barr will speak at 1 p.m. Friday and San Francisco Fed President Mary Daly will speak at at 4:15 p.m. Eastern time.

Companies in focus

  • Shares of Wayfair Inc. W, +8.72% rose sharply after the company announced another round of layoffs.
  • Super Micro Computer Inc. SMCI, +30.25%, a manufacturer of computer products, saw its shares shoot higher after the company released a sales outlook that was far stronger than Wall Street had expected.  
  • Nvidia Corp. NVDA, +1.91% and Broadcom Inc. AVGO, +2.96% shares were up strongly in early trading amid widespread optimism in the chips space.
  • Shares of Roomba maker iRobot IRBT, -28.51%  sank on Friday following reports that European antitrust regulators planned to block a planned buyout by Amazon.com Inc.
  • Shares of Travelers Companies Inc. TRV, +4.69% surged into record territory Friday, after the property casualty insurer said lower catastrophe losses and higher underwriting gains helped produce record profits.