The promise of artificial intelligence (AI) continues to drive the Nasdaq to new heights, with the tech-heavy index reaching an all-time high on Friday, surpassing its previous record set in 2021. The Nasdaq finished the week up 1.74%, while the S&P 500 also saw gains of nearly 1%. However, the Dow Jones Industrial Average experienced a slight decline of 0.11%.
This surge in tech stocks can be attributed to a strong earnings season, with 73% of S&P 500 companies reporting an upside earnings surprise and 64% reporting better-than-expected revenue results. Two portfolio stocks, TJX Companies and Salesforce, also reported impressive earnings, further boosting investor confidence.
The economic report of the week, the personal consumption expenditure (PCE) index, showed a rise of 0.4% in January, in line with expectations. This points to further disinflation at both the headline and core levels, a win for the Federal Reserve’s efforts to combat inflation.
Looking ahead, investors are eagerly awaiting the February nonfarm payrolls report, which will provide insight into the health of the consumer and the path of inflation. Additionally, key economic reports on manufacturing and services, as well as earnings results from several companies, will be closely watched in the coming week.
Overall, the outlook for the market remains positive, with the promise of AI driving tech stocks to new heights and investors cautiously optimistic about the future.
