Stock Market: weekly update (October 28 – November 1): US stocks at record highs

Stock Market: weekly update (October 28 – November 1): US stocks at record highs


US stock markets posted strong gains last week in response to US economic data and US-China trade news. A strong US jobs report out on Friday supported risk appetite for stocks. All three major US stock indexes climbed for the week, also boosted by a strong US corporate earnings season, which helped dispel jitters about a slowing US economy. Thus, the S&P 500 rose by 1.0% to record highs on Friday, with a 1.5% gain week-on-week. The S&P 500 has posted four consecutive weeks of gains. More than three-quarters of companies in broad-based index that have reported results through Friday have beaten analysts’ expectations. The US economy added 128,000 jobs in October. The better-than-expected US jobs print came even as a General Motors workers strike shaved off more than 40,000 jobs last month. Investors interpreted the report as a sign the US economy is not close to falling into a recession. This could add fuel to the market’s record
run. The Dow Jones rose by 301 points or 1.1% to close at 27,347.36. Over the week, the Dow advanced by 1.4%. The blue chips are less than 0.1% away from their July highs. Meanwhile, the Nasdaq Composite gained 1.1% to end the day at 8,386.40, logging a 1.7% rise on a weekly basis. The tech-heavy index hit its first high since July. Year to date, the Nasdaq composite is up by about 26%. Three Fed rate cuts this year—the most recent on Wednesday—helped fuel the market’s rally by encouraging companies to borrow more and driving investors in favor of riskier assets. In corporate news, shares of Fitbit surged after the maker of wearable fitness devices said it had agreed to be acquired by Google parent Alphabet for $2.1 billion. The stock skyrocketed by 96 cents, or 16%, to $7.14 on Friday. For the week, it gained the whopping 63.01%. The acquisition allows the US tech giant to enter the wearable device market, which is currently dominated by rivals like Apple and Samsung. Qorvo shares surged by 20.23% after the chipmaker posted quarterly numbers that topped analyst expectations. The company also issued strong earnings and revenue guidance for the current quarter. Upside Q3 guidance saw revenue of $840-860M and EPS of about $1.67. And here are some key events coming up this week: Earnings are due from companies including: SoftBank, BMW, Walt Disney, and Toyota. Regional Fed presidents including Charles Evans, John Williams and Patrick Harker will speak at events on Wednesday. The USDA World Agricultural Supply and Demand Estimates Report for November comes out Friday.

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