The stock market soared to record highs on Wednesday. The S&P 500 gained 0.61% and closed at 6,086.49. The tech-heavy Nasdaq advanced 1.3% to 19,735.12.
The Dow Jones Industrial Average added 308.51 points, or 0.69%, to close at 45,014.04. This marked the first time it ended the day above the 45,000 threshold. All three major indexes reached all-time highs and closed at record levels.
Salesforce shares climbed nearly 11% after the company posted earnings that beat estimates. Chipmaker Marvell Technology also exceeded earnings expectations and issued strong fourth-quarter guidance. Its shares surged 23%, marking Marvell’s best daily performance since May 2023.
These gains powered the tech sector higher, ending the day up by 1.8%. Nancy Tengler, CEO of Laffer Tengler Investments, commented on the resilience of the tech sector. “People have come out and said, the tech trade’s over.
If you look at sector performance, the stocks have lagged since July — but that doesn’t mean that they can’t reaccelerate,” Tengler said. “You could argue that it’s good the market’s broadening out. But that doesn’t mean it has to be a zero-sum game, that technology cannot outperform.”
Wednesday’s market moves come ahead of new U.S. employment data due on Friday.
Economists polled by Dow Jones expect the U.S. economy to have added 214,000 jobs in November. However, a report from ADP released on Wednesday showed companies added just 146,000 jobs in November. This fell short of the 163,000 positions economists had anticipated.
This data could provide investors with insights into the Federal Reserve’s future policy decisions. Fed Chair Jerome Powell commented on the current economic conditions. He indicated a cautious approach toward rate cuts.
“The labor market is better, and the downside risks appear to be less in the labor market. Growth is definitely stronger than we thought, and inflation is coming out a little higher. So the good news is that we can afford to be a little more cautious as we try to find neutral,” Powell said during a discussion in New York.
Farmer sentiment has surged in the aftermath of the U.S. presidential election. It reached its highest point since May 2021, according to the latest reading from the Purdue University/CME Group Ag Economy Barometer. The barometer increased by 30 points to 145, as farmers expressed optimism about a more favorable regulatory and tax environment for the agricultural sector.
In November, only 9% of farmers anticipated a more restrictive regulatory environment over the next five years. This marked a significant drop from 41% in October. High-flying technology stocks may soon reclaim their leadership amid the broadening market rally, according to Wolfe Research.
In a recent note, strategist Rob Ginsberg suggested more upside potential for tech giants. “The relative performance of the MAG 7 looks ready to punch through its July high. We discussed Microsoft (MSFT) yesterday, but others such as Apple (AAPL), Meta (META), and Amazon (AMZN) are coming alive as well,” Ginsberg wrote.
More shoppers than expected visited brick-and-mortar retail stores this Thanksgiving, according to UBS. The National Retail Federation (NRF) data revealed that Black Friday traffic dropped only by 2% year over year. This was better than the anticipated 8% decline.
The NRF also noted an increase in early holiday shopping, with 45% of shoppers starting before November, up from 43% last year. Robinhood CEO Vlad Tenev announced Wednesday that the brokerage is exploring opportunities in the sports betting market. This could possibly happen through event contracts.
“We’re keenly looking into that space. Nothing to announce just yet, but it’s so important to our customers and in culture that we’re excited about it,” Tenev said at Robinhood’s inaugural investor day. Shares of Robinhood rose more than 2% following the announcement.
Markets close at new record highs
The Korean won strengthened slightly by 0.2% against the dollar on Wednesday, trading at 1,412.80 won per dollar. This movement comes after South Korea President Yoon Suk Yeol issued a martial law decree, which initially rattled financial markets.
The won had dropped to the 1,442 won level on Tuesday before the National Assembly lifted the martial law declaration. The technology sector, up 1.5%, led the S&P 500 higher on Wednesday. Consumer discretionary and communication services stocks were the next best performers, while energy was the biggest laggard.
The U.S. stock market posted another week of strong performances. Major large-cap indices such as the S&P 500, the Dow Jones, and the Nasdaq 100 extended their record highs. Technology and consumer discretionary sectors led the gains, driven by several mega-cap tech giants ― Apple, Amazon.com, and Meta Platforms ― hitting new peaks.
In November, the U.S. labor market showed robust signs of recovery. Nonfarm payrolls rose by 227,000, up sharply from an upwardly revised 36,000 in October and above expectations of 220,000. The unemployment rate inched up to 4.2%, as expected, while the average hourly wage increased.
The University of Michigan’s consumer sentiment index revealed the most favorable overall conditions in seven months. This was bolstered by a significant rise in the current conditions subindex. Yet, the survey also highlighted growing concerns over inflation, with short-term inflation expectations rising.
A relevant share of consumers reported advancing purchases of durable goods due to fears of accelerating prices. Stellantis’ Carlos Tavares exited, intensifying market concerns after a significant drop in value in 2024. Leadership uncertainty now threatens recovery, with analysts warning of escalating challenges in a highly competitive market.
Veteran trader Jason Shapiro urged caution on going “aggressively long” on risk assets. This came after Bitcoin hit a new high of $100,000 before retreating, as did stocks on Thursday. The warning highlights the importance of prudent risk management and strategic positioning in volatile markets.
Meanwhile, Fed Chair Jerome Powell likened Bitcoin to gold, describing it as a virtual and digital speculative asset and a store of value. There are 10 S&P 500 stocks ― spanning industries from BlackRock to Western Digital Corp. to Royal Caribbean Cruises ― that historically excel in December’s second half.
These consistent performers will again leverage what’s known as the Santa Rally effect, presenting investors with strong year-end opportunities. Some experts attribute this rally to seasonal factors such as holiday shopping and investors wrapping up their books before the end of the year, ahead of a slower January. Billionaire Warren Buffett, known for being a penny pincher, used to hand out $10,000 cash Christmas gifts.
However, family members say he has switched to giving stocks, advising recipients to either cash them in or hold. This shift reportedly came when recipients were spending the cash too fast. True to his investment philosophy, the change offers a practical lesson in building long-term wealth.
Technology stocks outperformed this week, pushing the Nasdaq Composite up by 0.7% on Friday and targeting a 3.2% rise for the week. The S&P 500 also grew 0.3% on Friday, achieving a 0.9% weekly gain. Both indexes are heading towards their third consecutive weekly win.
Conversely, the Dow Jones Industrial Average fell by 90 points, or 0.2%, on Friday afternoon. This set it on pace for a 0.5% weekly decline, breaking a two-week winning streak. The S&P 500 and Nasdaq benefited notably from a rally in technology stocks.
The Roundhill Magnificent Seven ETF, which focuses on seven major technology companies, surged by 5.7%. The iShares Semiconductor ETF increased by 2.1%. Key earnings reports from major tech firms like Salesforce contributed to this surge.
Recent economic data has supported the belief that the Federal Reserve will likely implement a quarter-point interest rate cut during its upcoming policy meeting. The Dow has faced challenges this week due to its lower exposure to technology stocks and its member weighting by stock price rather than market capitalization. This leaves the Dow particularly impacted by the 9.6% weekly drop in UnitedHealth stock, marking its worst performance since March 2020.
In summary, while technology stocks boosted the S&P 500 and Nasdaq to new heights, the Dow Jones Industrial Average struggled to keep up due to different index methodologies and sector exposures.
