The Nasdaq Composite closed at a record high on Friday, driven by a surge in Nvidia shares and a broader rally in technology stocks. The S&P 500 and Dow Jones Industrial Average also posted gains, capping off a week of strong performance for the stock market despite concerns over inflation and interest rates.
Key Takeaways
- Nasdaq Record: The Nasdaq Composite closed at a record high of 16,920.79, up 1.1% for the day.
- Nvidia Surge: Nvidia shares gained 15% for the week, driven by strong quarterly earnings and high demand for AI chips.
- Tech Rally: Other tech stocks, including Microsoft and Meta, also saw significant gains.
- Economic Indicators: Mixed signals from economic data, including durable goods orders and consumer sentiment, influenced market sentiment.
- Interest Rates: Concerns over potential interest rate hikes by the Federal Reserve remain.
Nasdaq Composite Hits Record High
The Nasdaq Composite surged to a record close of 16,920.79, marking a 1.1% increase for the day. This milestone was largely driven by a strong performance in technology stocks, particularly Nvidia, which saw its shares rise significantly following a robust earnings report.
Nvidia Leads the Charge
Nvidia shares notched a 15% gain for the week, buoyed by better-than-expected quarterly earnings and strong demand for its artificial intelligence chips. The company’s stock topped $1,000 for the first time, reflecting investor confidence in its growth prospects.
Broader Tech Rally
The tech sector as a whole saw substantial gains, with major players like Microsoft, Meta, and Qualcomm contributing to the Nasdaq’s record close. The S&P 500’s information technology sector was the only one to post gains for the week, up 2.3%.
Economic Indicators and Market Sentiment
Mixed economic data influenced market sentiment throughout the week. Durable goods orders rose by 0.7% in April, exceeding expectations, while consumer sentiment showed signs of weakening. The University of Michigan’s Consumer Sentiment Index fell to its lowest level since November 2023, although it beat initial estimates.
Interest Rate Concerns
Despite the strong performance in the stock market, concerns over potential interest rate hikes by the Federal Reserve persist. Goldman Sachs has pushed back its forecast for the first rate cut to September from July, citing stronger-than-expected economic data.
Other Notable Performances
- Ross Stores: Shares jumped 7.8% after the retailer reported better-than-expected quarterly earnings.
- Deckers Outdoor: The company saw a 14.2% increase in its stock price, driven by strong sales of its Hoka and Ugg brands.
- Workday: Shares fell 15.3% despite strong earnings, due to a disappointing forecast for subscription revenue.
- Coinbase: The crypto services firm saw an 8% rise after the SEC approved applications for ether ETFs.
Global Market Reaction
Global markets had a mixed reaction to the week’s events. European stocks opened lower on Friday, while Asian markets saw declines in major indices such as Hong Kong’s Hang Seng and Japan’s Nikkei.
Overall, the week ended on a high note for U.S. stocks, particularly in the technology sector, as investors remain optimistic about the growth potential of artificial intelligence and other tech innovations.