The New York stock exchanges closed higher and the Nasdaq advanced 2% today. The euphoric reaction to the earnings reports of Alphabet and Microsoft overlapped with new signs of persistent inflation in the United States, which could postpone the interest rate cut cycle in the country.
The Dow Jones index advanced 0.40%, to 38,239.66 points; the S&P 500 gained 1.02%, at 5,099.96 points; and the Nasdaq rose 2.03%, to 15,927.90 points. During the week, there were gains of 0.67%, 2.67% and 4.23%, respectively. S&P 500 and Nasdaq recorded the biggest weekly gains since the beginning of November last year.
In particular, Alphabet jumped 10.22%, after Google’s parent company announced the payment of an unprecedented dividend, following a first quarter that exceeded market expectations. Thus, the company’s market value exceeded US$2 trillion for the first time in history, according to the website Companies Market Cap.
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For Bank of America (BofA) Securities, the balance sheet confirmed Alphabet as one of the beneficiaries of the development of artificial intelligence. “We remain constructive regarding Google’s infrastructure, data and distribution advantages,” says BofA, which raised the target price for the stock to US$200.
Among other technology giants, Microsoft rose 1.82%, after reporting profit growth in the first three months of the year. Snap soared 27.63%, following an increase in revenue.
With increased optimism towards AI, Nvidia gained 6.18%, Qualcomm rose 1.45%, and Broadcom rose 3.84%. On the contrary, Intel lost 9.20%, after projecting worse guidance than expected. Also after earnings, Chevron advanced 0.37%, but rival Exxon Mobil fell 2.78%.
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The movement pushed concerns about inflation in the United States to the background, in a week that showed a stronger consumer spending price index (PCE) in the last quarter. Today, the country’s Commerce Department reported that PCE accelerated at the annual rate in March, but Capital Economics still expects the data to lose momentum ahead.
