Qualcomm, Big Tech lift S&P 500, Nasdaq to record highs

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Signage is seen on the facade of the New York Stock Exchange (NYSE) on Election Day in Manhattan, New York City, New York, November 3, 2020. — Reuters pic

NEW YORK, Nov 4 — The S&P 500 and the Nasdaq indexes hit a record high today, propped up by a slew of stellar earnings reports and as investors shrugged off the Federal Reserve’s first steps to begin paring its pandemic-era support.

Shares of Qualcomm Inc jumped 12.6 per cent after the chipmaker forecast better-than-expected profit and revenue for its current quarter on soaring demand for chips used in phones, cars and other internet-connected devices.

Booking Holdings Inc added 3 per cent after the online travel agent posted upbeat quarterly results.

Electronic Arts Inc and rival Take-Two Interactive Software Inc gained 2.8 per cent and 3.8 per cent, respectively, after they boosted their 2021 adjusted sales forecasts on strong gaming boom.

Six of the 11 major S&P sectors advanced in early trading, with energy, consumer discretionary and technology rising more than 1 per cent each.

Big banks including JPMorgan Chase & Co and Bank of America slipped more than 1 per cent, while the S&P 500 banks sub-index fell 1.7 per cent.

Yesterday, a widely expected move by the Fed on announcing its plan to start tapering its monthly bond purchases beginning this month, while staying patient on raising interest rates, also helped sentiment.

“You have better than expected earnings, a Fed that is following a well telegraphed path and the economic data for the most part has seen some sequential improvement as we start to get the October reports,” said Art Hogan, chief market strategist at National Securities in New York.

“You put all those things together and you get markets ultimately making new highs.”

A cheery third-quarter earnings season, coupled with an upbeat commentary about future growth from corporate America, has helped Wall Street largely dismiss concerns around rising prices, supply chain snags and a mixed macro-economic picture.

Data showed the number of Americans filing new claims for unemployment benefits fell to a fresh 19-month low last week, suggesting the economy was regaining momentum. It will be followed by a more comprehensive nonfarm payrolls report on Friday.

At 10.04am ET, the Dow Jones Industrial Average was down 19.02 points, or 0.05 per cent, at 36,138.56, the S&P 500 was up 16.98 points, or 0.36 per cent, at 4,677.55, and the Nasdaq Composite was up 98.09 points, or 0.62 per cent, at 15,909.68.

The CBOE market volatility index, a gauge for investor anxiety, fell to its lowest level since early July.

Tesla Inc added 1.3 per cent to scale new heights, while other mega-cap technology titans Google-owner Alphabet Inc, Apple Inc, Amazon.com and Meta Platforms also edged higher.

Merck & Co rose 1 per cent after Britain became the first country in the world to approve its Covid-19 antiviral oral pill jointly developed with Ridgeback Biotherapeutics.

Moderna Inc dropped 15 per cent after the vaccine maker cut its full-year sales forecast for its Covid-19 vaccine.

Meanwhile, US Representative Rick Larsen said on Wednesday his fellow House Democrats could complete votes on President Joe Biden’s social spending and infrastructure bills as early as midday on Friday.

Advancing issues outnumbered decliners by a 1.70-to-1 ratio on the NYSE and by a 1.36-to-1 ratio on the Nasdaq.

The S&P index recorded 53 new 52-week highs and two new lows, while the Nasdaq recorded 144 new highs and 16 new lows. — Reuters