listen to this articleUS stocks are coasting Friday towards the end of another winning week.
The S&P 500 rose 0.1% in intraday trading, aiming for a third straight week of wins after a mostly disastrous April. It had been on track for further gains, but was mostly lower after a depressing report on US consumer sentiment released this morning.
As of 11:15 a.m. ET, the Dow Jones Industrial Average was up 80 points, or 0.2%, and the Nasdaq Composite was down 0.1%.
The S&P 500 index is back within 0.7% of its all-time high, with renewed hopes that the Federal Reserve will cut interest rates before the end of the year. A series of positive reports about the profits of major US companies that exceeded expectations also supported the market.
Gen Digital joined the parade, surging 15.3% after reporting better-than-analyst-expected profits for the first three months of 2024. The cyber safety company, whose brands include Norton and LifeLock, also authorized a stock repurchase program of up to $3 billion. The company joins the growing list of companies announcing such large-scale programs, helping investors increase their earnings per share.
Novavax more than doubled, rising 124.6% after announcing a deal with Sanofi worth more than $1.2 billion. The agreement includes a license to co-commercialize Novavax’s coronavirus vaccine worldwide, with certain exceptions. Novavax also reported a loss for the latest quarter that was slightly smaller than analysts expected.
Earnings beat expectations, but helped offset Akamai Technologies’ 7.5% decline in revenue. The company, which handles cloud computing, security, and content distribution, has also partially revised its full-year earnings forecast downward.
The company said the rising value of the U.S. dollar against other currencies, along with slowing traffic growth across the industry, is hurting its business. This helped overshadow the company’s announcement of a stock buyback program worth up to $2 billion.
In the bond market, U.S. Treasury yields rose following a depressing preliminary report from the University of Michigan.
Joan Hsu, director of consumer research, suggested that U.S. consumer sentiment has deteriorated much more than economists expected, with the decline being “statistically significant and sentiment It was large enough that it was said that the market had reached its lowest level in about six months. .
What could be even more discouraging is that U.S. consumers now expect inflation to be 3.5% next year, up from the 3.2% expected last month. There are concerns that if these expectations spiral upward, it could lead to a vicious cycle that worsens inflation.
This highlights what some companies have recently said are increasing hardships among their customers, especially those in low-income groups.
The yield on the 10-year U.S. Treasury rose to 4.50% from 4.46% late Thursday. However, the move was still relatively slow compared to the decline from 4.70% late last month.
Bank of America interest rate strategists said markets could remain stagnant until Wednesday’s much-awaited update on U.S. consumer-level inflation. A majority of traders still agree that the U.S. Federal Reserve will cut interest rates one or two times this year, according to data from CME Group.
Last week, Federal Reserve Chairman Jerome Powell said that despite continued high inflation this year, the central bank is still closer to cutting than raising key interest rates, helping push yields lower. did. The Fed is keeping its key interest rate at the highest level in more than 20 years, hoping to bring high inflation under control once and for all.
Meanwhile, weaker-than-expected jobs numbers released last weekend strike the difficult balance between keeping the U.S. economy strong enough to avoid a deep recession but not strong enough to worsen inflation. He suggested that it could be successful.
In overseas stock markets, London’s FTSE 100 index rose 0.7% after the government reported that the UK economy had returned to growth at the start of the year. The company’s results beat expectations and were the second consecutive quarter in which the economy contracted.
In Japan, the Nikkei Stock Average in Tokyo rose 0.4% on reports that strong car exports are reducing Japan’s trade deficit and generating solid profits from overseas investments.
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AP Business writers Yuri Kageyama and Matt Ott contributed.
