- U.S. stocks on Friday ended the week with their biggest gains since November.
- Alphabet and Microsoft led the gains following the results. Alphabet announced its first-ever dividend.
- The PCE inflation index was higher than expected, but the market seems to be ignoring the latest data.
U.S. stocks ended higher on Friday, ending their best week since November as tech stocks rose on gains from large-cap powerhouses.
Major stock indexes avoided modest inflation data early in the day. Personal consumption spending, the Fed’s most important indicator of inflation, rose 2.8% in March, beating expectations. Still, the statistics remained broadly consistent, with no further surprises after Thursday’s economic data also showed a rise in prices.
Instead, traders focused primarily on the profitability of Alphabet and Microsoft.
Google’s parent company Alphabet soared more than 10% on Friday to a record high and its market capitalization exceeded $2 trillion after announcing its first-ever dividend.
Meanwhile, Microsoft also rose, with the tech giant reporting strong results on the strength of its Azure cloud division.
Amazon, Nvidia and social media company Snap all soared, with broader sectors moving higher in lockstep.
Fundstrat’s Mark Newton said in a note Friday that Alphabet and Microsoft’s gains pave the way for a broader rally.
“Technology as a sector feels close to support and should see no further downside,” he said.
Meanwhile, Savita Subramanian, head of U.S. equities at Bank of America, said Friday that the U.S. economy remains strong despite slowing gross domestic product (GDP) and rising inflation.
“It feels like the world is ending, we’re going into a recession, inflation is going to get out of control, we’re going to end up in stagflation, but 98% or 96% of that bell curve is where all the rest of us… That scenario is likely to happen,” Subramanian said in an interview with CNBC.
Apple and Amazon are scheduled to report earnings next week, and investors will be keeping an eye on the Federal Reserve’s next policy meeting, scheduled for April 30-May 1.
Here are the U.S. indices as of Friday’s 4 p.m. close:
Here’s what else is going on:
In Commodities, Fixed Income and Cryptocurrencies:
- West Texas Intermediate crude oil was almost flat at $83.66 per barrel. Brent crude, the international benchmark, fell 0.3% to $89.32 per barrel.
- Gold rose to $2,351 per ounce.
- The yield on the 10-year Treasury note fell 4 basis points to 4.667%.
- Bitcoin falls 1.5% to $63,875
