US Markets Hit Record Highs: Tech Earnings on Tap

The Dow Jones Industrial Average hit a new high for the year on Monday, with stocks buoyed by solid earnings from technology companies. The measure of US blue-chip stocks jumped 205 points or 1.4% to 26,569 at 4pm in New York, after closing at 26,364 on Friday. The S&P 500 index also reached an all-time high of 2,919 points and the Nasdaq Composite Index touched 7406 points.

Shares in Alphabet Inc. Apple Inc. Microsoft Corp. Amazon.com Inc. Facebook Inc., Intel Corp and Netflix Inc were among those that rose strongly following their latest quarterly reports this week while shares in other large tech firms such as Cisco Systems and IBM fell back slightly.

The heightened level of investor confidence was seen as a sign that gains this year, which had been fueled by strong economic activity and optimism over President Donald Trump’s tax reform plans, would resume following recent losses. The S&P 500 index lost 5% last week for the first weekly fall in seven while the Nasdaq Composite Index dropped 3%.

The renewed confidence in the technology sector also helped to push up the so-called FAANG companies (Facebook, Apple, Amazon.com, Netflix and Google owner Alphabet Inc.) by 1.6%, making them the biggest gainers on Monday of all 11 S&P sectors. Over the last 12 months, these five stocks have gained 63.3% on average, far outpacing the Dow Jones Industrial Average’s 20.7% increase and the S&P 500 index’s 18.8% gain.

In a note, Barclays said that FAANG companies globally represented nearly one-fifth of total market capitalization. We continue to believe that this trend will end badly, though markets may not fully anticipate the consequences of regulation on these firms, it added.

“Regulation will be an ongoing theme in 2018, and while some companies are better positioned than others (and will likely benefit from increased regulation), at this stage we believe that most FAANG names will not be insulated. The Dow Jones Industrial Average hit a new high for the year on Monday, with stocks buoyed by solid earnings from technology companies.

The measure of US blue-chip stocks jumped 205 points or 1.4% to 26,569 at 4pm in New York, after closing at 26,364 on Friday. The S&P 500 index also reached an all-time high of 2,919 points and the Nasdaq Composite Index touched 7406 points.

Shares in Alphabet Inc. Apple Inc. Microsoft Corp. Amazon.com Inc. Facebook Inc., Intel Corp and Netflix Inc were among those that rose strongly following their latest quarterly reports this week while shares in other large tech firms such as Cisco Systems and IBM fell back slightly”.

“The heightened level of investor confidence was seen as a sign that gains this year, which had been fueled by strong economic activity and optimism over President Donald Trump’s tax reform plans, would resume following recent losses. The S&P 500 index lost 5% last week for the first weekly fall in seven while the Nasdaq Composite Index dropped 3%.