NEW YORK: US stock indexes rose on Friday, putting them on track to close October in the green, after Amazon’s upbeat earnings forecast helped ease concerns over Big Tech’s heavy spending on artificial intelligence.
Amazon shares jumped 10.6 percent to an all-time high after the online retailer forecast quarterly sales above estimates, helped by cloud revenue rising at the fastest clip in nearly three years.
Apple’s forecast for iPhone sales in the holiday quarter surpassed Wall Street expectations, but CEO Tim Cook flagged supply constraints. Its shares were last flat.
Nvidia, which became the first publicly listed firm to surpass USD5 trillion in market value earlier this week, rose 1.6 percent after CEO Jensen Huang said he hoped the company’s state-of-the-art Blackwell chips can be sold in China.
AI frenzy pushed Wall Street to record highs earlier this week before concerns about major spending from Microsoft and Meta as well as doubts about further interest rate cuts from the Federal Reserve spooked investors.
Still, for the month, the S&P 500 was up 2.7 percent, putting it on track for a sixth consecutive monthly gain - its longest such streak since August 2021.
The Nasdaq Composite was on pace for a seventh consecutive monthly advance, while the Dow was set for its sixth straight monthly win - their longest runs since January 2018.
At 12:01 p.m. ET, the Dow Jones Industrial Average fell 31.46 points, or 0.07 percent, to 47,490.66, the S&P 500 gained 15.34 points, or 0.22 percent, to 6,837.68 and the Nasdaq Composite gained 152.31 points, or 0.65 percent, to 23,733.45.
Traders have since pared bets on a December cut, with futures now pricing a 67.9 percent chance of a 25-basis-point move, down sharply from 91 percent a week ago.
Two regional Fed presidents also criticized the decision to ease policy, arguing that inflation remains too high and the labor market does not need additional support.
Of the 315 S&P 500 companies that have reported third-quarter results so far, 83.2 percent have surpassed analysts’ estimates, according to LSEG data. That’s well above the historical average, where roughly 67 percent of firms beat forecasts.
In other moves, Warner Bros Discovery rose 1.9 percent following a Reuters report that Netflix was actively exploring a bid for the company’s studio and streaming business.
Netflix added 3.6 percent as it unveiled plans for a 10-for-1 stock split.
Getty Images rose 5 percent after signing a global multi-year licensing agreement with Perplexity AI.
Advancing issues outnumbered decliners by a 1.21-to-1 ratio on the NYSE, and by a 1.31-to-1 ratio on the Nasdaq.
The S&P 500 posted 16 new 52-week highs and 34 new lows while the Nasdaq Composite recorded 94 new highs and 103 new lows.
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