The Dow Jones Industrial Average and S&P 500 rallied north of 1% to close at new highs Friday, while the Nasdaq composite touched its highest level in two years. All three major indexes finished a second-straight week of gains as the Nasdaq rallied 2.3%, the S&P 500 climbed 1.2% and the Dow Jones index added 0.7%.
Among the Magnificent Seven stocks, Nvidia, Meta Platforms and Google-parent Alphabet fared best, but Tesla could only muster a meager gain. Tesla reports earnings next week, along with Netflix.
Nvidia stock hasn't looked back since giving a buy signal on Jan. 8, when it cleared a 505.48 entry.
Insurer Travelers was a top gainer on the Dow Jones today after reporting strong earnings, helped by lower catastrophe losses. IBM also outperformed ahead of its fourth-quarter earnings report next week.
Intel and Salesforce also outperformed among Dow Jones stocks, rising 3% and 2.3%, respectively.
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Beyond Dow Jones Stocks
After jumping nearly 1.4% Thursday in higher volume, the Nasdaq composite tacked on another 1.7% by the close. Breadth was less than 2-to-1 positive.
The Invesco QQQ Trust jumped 2% to an all-time high. Texas Instruments was a top gainer in the Nasdaq, up 4%. The stock gapped up past a 172.31 handle buy point with earnings due early next week.
Qualcomm and Broadcom rallied 4.6% and 5.9%, respectively. Qualcomm skated past a 146.89 alternative entry. Broadcom, meanwhile, topped an 1,151.82 buy point and is now extended like QCOM.
IBD's chip designer group was one of the day's top performers, rising 4.1% to an all-time high. The chip-equipment group rallied 3.8%, with three top performers in the group set to report earnings next week: ASML, Lam Research and KLA.
Meanwhile, the S&P 500 picked up 1.2% Friday, and the Russell 2000 small-cap index reversed higher for a gain of around 1%. Breadth was more than 2-to-1 positive on the New York Stock Exchange. The Dow Jones index jumped 395 points and added 1.1%
The Russell 2000 lost ground for the fourth straight week but held support at its 10-week line.
Among 12 sectors tracked by S&P, the Financial Select Sector SPDR ETF was one of the top performers, up 1.6%. Asset manager KKR gave an early buy signal by moving above a trendline. Shares jumped 3.2%
Big Day For Super Micro
Super Micro Computer vaulted nearly 36% after the company significantly raised its fiscal second-quarter earnings and revenue outlook. It now sees adjusted profit of $5.40-$5.55 a share, well above estimates for $4.51.
Super Micro predicted revenue of $3.6 billion to $3.65 billion, well ahead of analysts' consensus forecast for $2.8 billion. The company cited a "strong market and end-customer demand for our rack-scale, AI and total IT solutions." Super Micro hasn't announced an earnings date yet, but last year the company reported results on Jan. 31.
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Meanwhile, the 10-year Treasury yield ticked lower to 4.13% just after the market close after hitting an intraday high of nearly 4.2% as financial markets dial back expectations of aggressive rate cuts by the Federal Reserve this year. Atlanta Fed President Rafael Bostic on Thursday said the first rate cut could be sometime in the third quarter.
Fed funds futures traders, according to the CME FedWatch tool, still think the first rate cut could come as early as the March meeting. The current federal funds rate is 5.25% to 5.5%. Yet traders think several rate cuts could knock the Fed funds rate down to 3.75% to 4% by year's end.
Other Stock Market Movers
Outside the Dow Jones index, iRobot was a big loser on the stock market today, down around 27%, after the Wall Street Journal reported that Amazon's acquisition of the company won't pass muster with European regulators. Amazon first announced plans to buy the Roomba vacuum cleaner maker in August 2022 for $1.7 billion.
Pure Storage followed through after Thursday's breakout over a 38.28 entry. Shares jumped another 5%.
Chip designer Arm Holdings was a top gainer in the MarketSmith Growth 250, up nearly 6%. ARM joined the Leaderboard model portfolio on Dec. 8 at 65.61.
Several growth stocks came under selling pressure in the MarketSmith Growth 250, including Celsius, which dived nearly 13%. Bank of America downgraded Celsius to neutral from buy and kept its price target at 65, citing increasing competition, among other things.
Follow Ken Shreve on X/Twitter @IBD_KShreve for more stock market analysis and insight.
