The S&P 500 and the Nasdaq touched all-time highs on Thursday on a remarkable earning report as investors overlook the Federal Reserve’s asset tapering plan while borrowing costs remain low.
Earlier on Wednesday, the Dow dropped from a record closing high as big banks Goldman Sachs Group (GS.N) and JPMorgan Chase & Co (JPM.N) slipped 1.7% and 2.6% respectively.
Shares of Qualcomm Inc (QCOM.O) rose by 11.4% following the chipmaker’s forecast of better-than-expected profit and revenue for the ongoing quarter.
Rival Nvidia Corp (NVDA.O) also jumped 9.9% to give the biggest boost to the S&P 500 and Nasdaq. The Philadelphia SE semiconductor index (.SOX) also contributed 2.1%.
Rivals, Electronic Arts Inc (EA.O) and Take-Two Interactive Software Inc (TTWO.O) rose by 2.9% and 2.3%, respectively, following a boost in their 2021 adjusted sales projections owing to strong gaming boom.
Out of the total of 11 major S&P sectors, 3 advanced while financials (.SPSY) and healthcare (.SPXHC) dropped by over 1%.
The banks sub-index (.SPXBK) lost 2.2%.
A widely expected step by the Fed regarding the announcement of its plan to begin tapering its monthly bond purchases starting this month while remaining patient on increasing interest rates also boosted sentiment on Wednesday.
Managing director of trading and derivatives for Charles Schwab in Austin, Texas Randy Frederick said, “We have had a very strong earnings season and the Fed has followed through on what it was preparing markets for and investors generally get happy if they get what they expect. The last time the Fed tapered, it took more than a year for it to hike rates and it looks like that’s what is going to happen going ahead too, with only one-third of the market factoring hikes next year.”
A pleasant third-quarter earnings season, in addition to an upbeat commentary regarding the future growth from corporate America, has aided Wall Street in easing concerns pertaining to soaring prices, supply chain snags, and a mixed macro-economic landscape.
At 11:56 a.m. ET, the Dow Jones Industrial Average (.DJI) had dropped by 89.73 points, or 0.25%, at 36,067.85, the S&P 500 (.SPX) had gained 11.41 points, or 0.24%, at 4,671.98, and the Nasdaq Composite (.IXIC) jumped by 87.46 points, or 0.55%, at 15,899.04.
Tesla Inc (TSLA.O) contributed 1.5% to scale new heights, as other mega-cap technology giants Google-owner Alphabet Inc (GOOGL.O), Meta Platforms (FB.O), and Amazon.com (AMZN.O) also gained.
Merck & Co (MRK.N) jumped 2.5% following Britain becoming the first country to approve its COVID-19 antiviral oral pill jointly developed with Ridgeback Biotherapeutics.
Moderna Inc (MRNA.O) plunged 18.4% following the vaccine maker slashed its full-year sales projection for its COVID-19 vaccine.
Declining issues were more in number than the advancers for a 1.15-to-1 ratio on the NYSE and for a 1.36-to-1 ratio on the Nasdaq.
The S&P index posted 69 new 52-week highs and four new lows, as the Nasdaq posted 183 new highs and 25 new lows.
