Enthusiasm for AI gives biggest weekly gain this year to S&P 500 and Nasdaq – Stock Exchange

Expectations were high, but the results from Alphabet and Microsoft did not disappoint, fueling greater risk appetite on Wall Street this Friday.

The enthusiasm was visible, with North American stock exchanges ending up painted green. The S&P 500 gained 1.02% to 5,099.81 points and the technological Nasdaq Composite gained 2.03% to 15,927.9 points. In the accumulated result for the week, they actually recorded the biggest weekly gain this year (2.67% and 4.23%, respectively).

Looking at the industrial Dow Jones, the balance of the day was also positive, although less expressive, with the index register an increase of 0.4% to 38,239.66 points.

Alphabet and Microsoft presented results for the first and third fiscal quarters, respectively, yesterday, with both exceeding estimates. In the case of the owner of Google, the net result was 23.66 billion dollars, or 1.89 dollars per share – compared to 15.05 billion in the same period of the previous year. Microsoft recorded profits of US$21.93 billion (US$2.94 profit per share), which translates into an increase of 20% compared to the value recorded in the same period last year.

The numbers pleased investors and were reflected in today’s trading, with the Alphabet recorded a rise of 9.97% to $173.69 and Microsoft gained 1.82% to $406.32. By drag there were other listed companies also linked to artificial intelligence (AI): Nvidia rose 6.18% to $877.35 and Advanced Micro Devices added 2.37% to $157.4.
For the market, the message seems to have been clear: the investment in AI is bearing fruit and there is room for a greater rally.

Solita Marcelli, analyst at asset manager UBS Global, believes that the most recent corporate results have eased concerns about a grayer macroeconomic scenario. “With fundamentals for the technology sector remaining robust, we continue to highlight that the recent correction offered interesting entry points for stocks related to artificial intelligence and technology,” she said, speaking to Bloomberg.

In addition to the accounts from the technology giants, the market also saw some relief with the new inflation data. This is because the household consumption expenditure (PCE) price index, which is seen as the US Federal Reserve’s (Fed) preferred inflation indicator, rose 2.7% in March, narrowly exceeding expectations. of analysts (who expected a 2.6% increase). In monthly terms, the increase was 0.3%in line with the evolution recorded in February.

For Clark Bellin, from Bellwether Wealth, the data known today keeps interest rate relief on the table later this year, albeit in the last quarter. “We believe that the stock market will be able to overcome this context of high interest rates, as company results remain robust and companies are discovering how to continue growing despite this environment”, he argued, also in statements to the financial agency . Despite recognizing that investors would like to see interest rates fall, he stresses that “the stock market has the capacity to continue to rise, even if there are no interest rate cuts this year.”