S&P 500 hits record high on Trump’s AI investment plans and Netflix’s results
Data pointing to strong US economy amid slowing inflation and Trump’s moderate approach to tariffs help risk-taking
22 January 2025 - 21:10
byJohann M Cherian and Sukriti Gupta
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Bengaluru — Wall Street’s main indexes rose on Wednesday, with the benchmark S&P 500 hitting an all-time high, as investors cheered President Donald Trump’s multibillion-dollar support to bolster artificial intelligence (AI) infrastructure and streaming giant Netflix’s strong quarterly performance.
Data pointing to a strong economy amid cooling inflation and Trump’s moderate approach to tariffs have helped risk-taking since last week, with the S&P 500 and the Dow at their highest in over a month.
“The name of the game with Netflix is live sports because live sports reduces churn. And they (Netflix) were able to raise prices, which shows their continued mode is getting stronger,” said Thomas Hayes, chairperson at Great Hill Capital.
Before midday, the Dow Jones industrial average rose 125.29 points, or 0.29%, to 44,152.24, the S&P 500 gained 50.60 points, or 0.84%, to 6,099.86 and the Nasdaq Composite gained 298.07 points, or 1.50%, to 20,054.85.
Meanwhile, Oracle gained 6.5%, a day after Trump said the company would invest $500bn in AI infrastructure with OpenAI and SoftBank, even though there was no clarity on funding.
“It (AI infrastructure plan) is going to be funded by private business and private investors ... in the case of SoftBank, they don’t have $500bn but they have access to some money and could probably raise more as they get the first few projects out and show early successes,” said Hayes.
Server makers Dell and Super Micro added 2.5% and 4.9%, respectively, while AI winners Microsoft added 3.5% and Nvidia rose 3.9%.
Three of the 11 S&P 500 sectors rose, with technology stocks leading with a 2.3% jump and an index tracking chip stocks surged 2.6%.
Investors also are awaiting clarity on Trump’s trade policies after he warned that tariffs on imports from China, Mexico, Canada and the EU could be issued on February 1, a reminder for markets that risks of a potential trade war and fresh inflation pressures prevailed.
The president has ordered federal agencies to complete comprehensive reviews of a range of trade issues by April 1 — the date that analysts at Barclays say markets should wait for to get more clarity on his tariff policy.
Traders expect the Federal Reserve to leave interest rates unchanged when it meets next week and expect it to deliver its first rate cut this year in July, according to data compiled by LSEG.
Procter & Gamble advanced 2.8% after beating second-quarter estimates, driven by growing demand for its household items in the US.
Johnson & Johnson fell 3%. The drugmaker reported fourth-quarter results above estimates.
Ford lost 3.5% as Barclays downgraded the stock, while Textron fell 4.5% after it forecast 2025 profit below estimates.
Halliburton slipped 1.6% after warning of softer activity in North America this year and posting a downbeat quarterly revenue.
Declining issues outnumbered advancers by a 1.35-to-1 ratio on the NYSE and by a 1.29-to-1 ratio on the Nasdaq.
The S&P 500 posted 37 new 52-week highs and four new lows, while the Nasdaq Composite recorded 89 new highs and 68 new lows.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
S&P 500 hits record high on Trump’s AI investment plans and Netflix’s results
Data pointing to strong US economy amid slowing inflation and Trump’s moderate approach to tariffs help risk-taking
Bengaluru — Wall Street’s main indexes rose on Wednesday, with the benchmark S&P 500 hitting an all-time high, as investors cheered President Donald Trump’s multibillion-dollar support to bolster artificial intelligence (AI) infrastructure and streaming giant Netflix’s strong quarterly performance.
Data pointing to a strong economy amid cooling inflation and Trump’s moderate approach to tariffs have helped risk-taking since last week, with the S&P 500 and the Dow at their highest in over a month.
On the day, Netflix jumped 10.9%, sending the S&P 500 communication services sector up 2%. The company reported a record number of subscribers for the holiday quarter, enabling it to increase prices for most service plans.
“The name of the game with Netflix is live sports because live sports reduces churn. And they (Netflix) were able to raise prices, which shows their continued mode is getting stronger,” said Thomas Hayes, chairperson at Great Hill Capital.
Before midday, the Dow Jones industrial average rose 125.29 points, or 0.29%, to 44,152.24, the S&P 500 gained 50.60 points, or 0.84%, to 6,099.86 and the Nasdaq Composite gained 298.07 points, or 1.50%, to 20,054.85.
Meanwhile, Oracle gained 6.5%, a day after Trump said the company would invest $500bn in AI infrastructure with OpenAI and SoftBank, even though there was no clarity on funding.
“It (AI infrastructure plan) is going to be funded by private business and private investors ... in the case of SoftBank, they don’t have $500bn but they have access to some money and could probably raise more as they get the first few projects out and show early successes,” said Hayes.
Server makers Dell and Super Micro added 2.5% and 4.9%, respectively, while AI winners Microsoft added 3.5% and Nvidia rose 3.9%.
Three of the 11 S&P 500 sectors rose, with technology stocks leading with a 2.3% jump and an index tracking chip stocks surged 2.6%.
Investors also are awaiting clarity on Trump’s trade policies after he warned that tariffs on imports from China, Mexico, Canada and the EU could be issued on February 1, a reminder for markets that risks of a potential trade war and fresh inflation pressures prevailed.
The president has ordered federal agencies to complete comprehensive reviews of a range of trade issues by April 1 — the date that analysts at Barclays say markets should wait for to get more clarity on his tariff policy.
Traders expect the Federal Reserve to leave interest rates unchanged when it meets next week and expect it to deliver its first rate cut this year in July, according to data compiled by LSEG.
Procter & Gamble advanced 2.8% after beating second-quarter estimates, driven by growing demand for its household items in the US.
Johnson & Johnson fell 3%. The drugmaker reported fourth-quarter results above estimates.
Ford lost 3.5% as Barclays downgraded the stock, while Textron fell 4.5% after it forecast 2025 profit below estimates.
Halliburton slipped 1.6% after warning of softer activity in North America this year and posting a downbeat quarterly revenue.
Declining issues outnumbered advancers by a 1.35-to-1 ratio on the NYSE and by a 1.29-to-1 ratio on the Nasdaq.
The S&P 500 posted 37 new 52-week highs and four new lows, while the Nasdaq Composite recorded 89 new highs and 68 new lows.
Reuters
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