Wall Street closed higher on Friday, driven by tech stocks. Investor mood was upbeat on strong earnings numbers, balanced out by falling energy prices. The three most widely followed indexes closed the session in the green.
How Did the Benchmarks Perform?
The Dow Jones Industrial Average (DJI) ticked up 36.86 points, or 0.1%, to close at 43,275.91. Nineteen components of the 30-stock index ended in positive territory, 10 ended in negative, while one was unchanged.
The tech-heavy Nasdaq Composite rose 115.94 points, or 0.6%, to close at 18,489.55.
The S&P 500 advanced 23.20 points, or 0.4%, to close at 5,864.67. Ten of the 11 broad sectors of the benchmark index closed in the green. The Communication Services Select Sector SPDR (XLC), the Real Estate Select Sector SPDR (XLRE) and the Utilities Select Sector SPDR (XLU) rose 0.7%, 0.7% and 0.6%, respectively, while the Energy Select Sector SPDR (XLE) slid 0.3%.
The fear-gauge CBOE Volatility Index (VIX) decreased 5.7% to 18.03. A total of 10.6 billion shares were traded on Friday, higher than the last 20-session average of 11.6 billion.
Netflix Earnings Dominate Headlines on Friday
Streaming major Netflix, Inc.’s NFLX shares soared 11.1% on Friday, having reported solid third-quarter 2024 earnings after the markets closed on Thursday. The company beat both earnings and revenue expectations. It reported earnings of $5.40 per share, surpassing the Zacks Consensus Estimate of $5.09. Its revenues of $9.82 billion outpaced the Zacks Consensus Estimate of $9.76 billion.
The company’s business was driven by its ad-supported membership tier, which jumped 35% in the quarter. Netflix also projected an upbeat outlook for the next quarter, expecting revenues to rise 14.7% to $10.13 billion. It estimates revenues of $43 billion to $44 billion for 2025, suggesting growth of 11% to 13% from its expected 2024 revenues of $38.9 billion.
While the company’s performance helped the communication services sector in particular on Friday, it drove the broader tech sector in general. Most of the Magnificent Seven stocks rose.
Consequently, shares of Telefonaktiebolaget LM Ericsson (publ) ERIC and Apple Inc. AAPL gained 2.7% and 1.2%, respectively. Ericsson currently carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Oil Prices Continue to Decline
Oil futures continued to fall on Friday, declining more than 7% in the week on concerns over demand from China and the war escalating in the Middle East.
Brent crude decreased $1.39, or 1.87%, to $73.06/barrel. WTI crude fell $1.45, or 2.05% to $69.22/barrel.
Weekly Roundup
Last week, the Nasdaq Composite, the S&P 500 and the Dow Jones Industrial Average climbed 0.8%, 0.9% and 1%, respectively. For the three major benchmark indexes, this was a sixth straight week of gains.
Economic Data
The U.S. Census Bureau and the U.S. Department of Housing and Urban Development jointly reported that building permits for September totaled 1,428,000. This is 2.9% below the revised August rate of 1,470,000.Earlier, the August number was reported to be 1,475,000.
In the same report, housing starts for September were reported to be at 1,354,000. This is 0.5% below the revised August estimate of 1,361,000. Earlier, 1,356,000 was the reported number for August.
Zacks Names #1 Semiconductor Stock
It's only 1/9,000th the size of NVIDIA which skyrocketed more than +800% since we recommended it. NVIDIA is still strong, but our new top chip stock has much more room to boom.
With strong earnings growth and an expanding customer base, it's positioned to feed the rampant demand for Artificial Intelligence, Machine Learning, and Internet of Things. Global semiconductor manufacturing is projected to explode from $452 billion in 2021 to $803 billion by 2028.
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Ericsson (ERIC) : Free Stock Analysis Report
Netflix, Inc. (NFLX) : Free Stock Analysis Report
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