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Indexes set for weekly gains
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S&P 500 breaks through 50-day moving average
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Indexes up: Dow 0.85%, S&P 1.29%, Nasdaq 1.66%
(New throughout, adds NEW YORK dateline, changes byline)
By Stephen Culp
NEW YORK, March 3 (Reuters) - Wall Street advanced on
Friday near the close of an up-and-down week, as U.S. Treasury
yields eased and economic data helped investors look past the
growing likelihood that the Federal Reserve will keep its
restrictive policy in place for longer than anticipated.
All three U.S. stock indexes were positive, led by the
tech-laden Nasdaq, which was given a solid boost by market
leading, interest rate sensitive megacaps. U.S. Treasury yields
eased in the wake of comments from Fed officials that calmed
fears over inflation and interest rates.
For the week, the indexes appear to be on track to notch
gains, with the S&P snapping a three-week losing streak and the
Dow enjoying its first weekly gain since late January.
The week also saw the benchmark S&P 500 break through its
50- and 200-day moving averages, two closely watched technical
levels.
"You have a market that's oversold, that traded down to
major support levels and it’s above the resistance level of the
50" day moving average, said Robert Pavlik, senior portfolio
manager at Dakota Wealth in Fairfield, Connecticut. "It’s an
indication that a shift is transpiring. And a lot of people are
suspect of it, but they don't want to be left behind."
Economic data released on Friday showed steady demand for
services, with purchasing managers' indexes (PMI) from the
Institute for Supply Management and S&P Global indicating that
activity in the sector continues to expand even as input prices
cool.
"Nothing indicates we're going off a cliff," Pavlik added.
"The employment market is still very strong and the data this
morning points to a soft landing."
At 1:56PM ET, the Dow Jones Industrial Average rose
279.29 points, or 0.85%, to 33,282.86, the S&P 500 gained
51.18 points, or 1.29%, to 4,032.53 and the Nasdaq Composite added 189.80 points, or 1.66%, to 11,652.78.
Among the 11 major sectors of the S&P 500, all but consumer
staples were in positive territory, with communication
services and consumer discretionary enjoying
the largest percentage gains.
Fourth-quarter earnings season is on the final stretch, with
all but seven of the companies in the S&P 500 having reported.
Results for the quarter have beaten consensus estimates 68% of
the time, according to Refinitiv.
Still, on aggregate, analysts believe S&P 500 earnings will
have fallen 3.2% in the fourth quarter compared to the prior
year, and expect negative year-on-year numbers for the first two
quarters of 2023. This would imply the S&P 500 entered a
three-quarter earnings recession in the closing months of 2022,
per Refinitiv.
Apple Inc jumped 2.9% after Morgan Stanley said the stock could rally more than 20% this year on a potential hardware subscription. Broadcom Inc advanced 5.5% after the chipmaker forecast second-quarter revenue above analysts' estimates as increased investments in AI spurred demand for chips. Among losers, Costco Wholesale Corp slipped 2.8% on the heels of its revenue miss, as high inflation dampened consumer demand. Chipmaker Marvell Technology Inc slid 6.3% in the wake of the company's quarterly profit miss and disappointing revenue forecast. Advancing issues outnumbered declining ones on the NYSE by a 4.63-to-1 ratio; on Nasdaq, a 2.33-to-1 ratio favored advancers. The S&P 500 posted 21 new 52-week highs and two new lows; the Nasdaq Composite recorded 73 new highs and 49 new lows.
(Reporting by Stephen Culp; Additional reporting by Sruthi Shankar in Bengaluru; Editing by Cynthia Osterman)
