The Nasdaq and S&P 500 rose on Friday as robust updates from Amazon.com and Intel lifted beaten-down megacaps, while investors also drew comfort from data that showed inflation rose largely in line with expectations.
Amazon.com jumped 7.0% after the e-commerce giant reported a pick up in growth at its most profitable cloud business.
Intel rallied 11.0% after the chipmaker forecast fourth-quarter revenue and margins above estimates. Chip stocks Advanced Micro Devices and Nvidia added 1.4% and 1.0%, respectively.
Megacaps Microsoft, Meta Platforms, Tesla and Apple rose between 0.5% and 3.5% at the end of a rough week for Big Tech.
Meanwhile, data showed U.S. consumer spending increased more than expected in September, keeping it on a higher growth path heading into the fourth quarter.
The personal consumption expenditures price index, considered to be the Federal Reserve’s preferred inflation gauge, climbed 0.4% in September compared with an estimated 0.3% rise.
Core inflation which excludes volatile food and energy components rose 0.3%, meeting estimates.
“There’s a lot of evidence of disinflation really kicking in throughout the economy,” said David Russell, global head of market strategy at TradeStation.
“The Fed seems to have accomplished a lot of what they were trying to do in terms of inflation but then we have a very strong job market, very strong GDP and the Fed really has no incentive to change their policy anytime soon.”
Futures contracts tracking Federal Reserve’s policy rate rose, reflecting increased confidence among traders that the central bank will not raise borrowing costs any further.
At 9:50 a.m. ET, the Dow Jones Industrial Average was down 75.24 points, or 0.23%, at 32,709.06, the S&P 500 was up 3.30 points, or 0.08%, at 4,140.53, and the Nasdaq Composite was up 87.37 points, or 0.69%, at 12,682.98.
Weighing on the Dow, Chevron fell 5.0% after the oil major reported a drop in third-quarter profit.
Shares of Exxon Mobil advanced 0.5% after it posted a higher profit compared with the prior quarter, though year-on-year earnings plunged nearly 54%.
Ford Motor sank 8.0% after withdrawing its full-year results forecast due to “uncertainty” over the pending ratification of its deal with the United Auto Workers union, and warning of continued pressure on electric vehicles.
Of the 245 companies in the S&P 500 that have reported earnings so far, 77.6% beat earnings expectations, LSEG data showed. Third-quarter earnings are expected to grow 4.3% from a year earlier.
Toothpaste-maker Colgate-Palmolive rose 1.6% after raising its annual organic sales and profit forecasts for a third time this year.
Enphase Energy dipped 13.5% after the solar inverter maker forecast fourth-quarter revenue below estimates.
The tensions in the Middle East were also on investors’ radar, with a Hamas official tying the release of hostages to Israel stopping the bombardment of Gaza which it launched after a deadly rampage by Hamas militants into the southern part of the country nearly three weeks ago.
Declining issues outnumbered advancers by a 1.62-to-1 ratio on the NYSE and by a 1.51-to-1 ratio on the Nasdaq.
The S&P index recorded no new 52-week high and 40 new lows, while the Nasdaq recorded eight new highs and 186 new lows.
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