By US stocks jumped on Wednesday as traders took in strong earnings and priced in further optimism for Donald Trump’s second-term agenda.
Major indexes ended the day higher, with the S&P 500 rising past 6,100 for the first time ever during Wednesday’s session. The benchmark index closed just shy of it’s all-time closing high of 6,090.27 reached on December 6.
Investors were impressed with a slew of strong results on Wall Street, with Netflix, United Airlines, and P&G rallying earlier in the day after the firms beat earnings estimates. Netflix in particular blew away Wall Street’s expectations, adding a record number of subscribers in the quarter and ending 2024 with over 300 million users.
The early days of the latest earnings season have been positive, generating excitement for more earnings beats to come as mega-cap tech firms get ready to report results next week.
Of the S&P 500 firms that have already reported, 79% have beat earnings estimates, above the 10-year average of 75%, according to FactSet.
Traders this week are also feeling optimistic about Trump’s agenda. That was showcased on Wednesday with AI stocks rallying after the president announced a $500 billion partnership between Oracle, OpenAI, and SoftBank for the expansion of AI infrastructure on Tuesday.
Oracle shares ended Wednesday 7% higher, while SoftBank shares jumped 11%. Semiconductor stocks also rallied, with Nvidia rising 4% and Taiwan Semiconductor rising 2% by the end of the trading session.
“Stocks are jumping toward fresh all-time highs as investors cheer new stateside AI investments and strong earnings from corporate America,” José Torres, a senior economist at Interactive Brokers, wrote in a note. “Strong earnings can continue driving equities north despite potential headwinds in the background. Indeed, heavier interest rates, inflation uncertainty, fiscal imbalances and stretched valuations can be conquered by profits growing strongly alongside the economy.”
Here’s where US indexes stood at the 4 p.m. closing bell on Wednesday:
- S&P 500: ,6,086.37 up 0.61%
- Dow Jones Industrial Average: 44,156.73, up 0.3% (+130.92 points)
- Nasdaq composite: 20,009.34, up 1.28%
Here’s what else happened today:
- Jamie Dimon thinks the stock market is looking “kind of inflated.”
- Here’s why one Harvard economist thinks the economy is headed for a recession in the second half of Trump’s term.
- The risk of a sell-off in crypto is looming amid the lack of policy announcements from Trump.
In commodities, bonds, and crypto:
- West Texas Intermediate crude oil edged lower 0.47% to $75.47 a barrel. Brent crude, the international benchmark, remained flat at $79 a barrel.
- Gold ticked higher 0.39% to $2,754 an ounce.
- The 10-year Treasury yield rose two basis points to 4.601%.
- Bitcoin slumped 1.82% to $104,197.
