The Standard & Poor’s 500 index climbed 18 points, or 0.9 percent, to 2,070. Six of the 10 sectors in the S&P 500 index moved higher, driven by technology stocks, which rose 3% and is up 6.6 % so far this year.
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The People’s Bank of China cut its one-year lending rate to 4.35% from 4.6%.
EUROPEAN ACTION: Stocks rallied for a second day in Europe in anticipation that the European Central Bank may inject more financial support into Europe’s ailing economy.
A rally in major technology stocks fueled by bumper earnings from heavyweight tech companies, Alphabet Inc., Microsoft Corp. and Amazon.com, were buoying the main indexes.
In January, Alphabet will report Google’s financial numbers separately.
The future of computing is in the cloud, and right now the top three companies benefiting are names we’re all familiar with: Amazon, Google and Microsoft. That 25% operating income margin was a big improvement both from the prior quarter’s 21% and the 8% it logged a year ago.
Take 23%, which is the pace at which sales grew in the third quarter. For Amazon, this translated into $2.09B in cloud revenues in the last quarter alone.
“Our Q3 results show the strength of Google’s business, particularly in mobile search”. Earnings are projected to by $1.878 per share.
Amazon also surprised analysts after reporting a profit on a 23% sales gain. The benchmark gauge is back above its average price for the past 200 days, and sits 2.6 per cent below an all-time high reached May 21. Meanwhile, phone revenue tanked by 54%.
Internet and software stocks have been the biggest contributors to the recovery from August’s selloff. But there is still a few reason to cheer.
Texas Instruments’ earnings also beat projections.
Wholesale gasoline fell 0.3 cents to close at $1.304 a gallon, heating oil fell 1.1 cents to close at $1.454 a gallon and natural gas fell 10 cents to close at $2.286 per 1,000 cubic feet.
The intraday trading high for Mark Zuckerberg’s social network giant was previous $99.73, set just 24 hours prior.
These factors have instilled confidence in investors.
Microsoft shares rebounded 10.08% $52.87 per share. Apple reports Tuesday, and Facebook on November 4. Heck, even Bing posted its first quarterly profit. Amazon’s disdain for posting net income means the stock has had a P/E over 100 for a few time; the more-steady Alphabet, which is transitioning into a return-of-cash story, has a forward P/E of a mere 22 despite this year’s gains.
But another positive move has been consolidation in the chip industry, with last week’s US$19 billion takeover bid from Western Digital for SanDisk pushing its stock up 70 percent. Investors have been dumping shares of everything from hospitals to traditional pharmaceutical companies and insurers in recent weeks.
LinkedIn offers an online platform for professionals to enhance their network in the virtual world.
“You are seeing the cloud shift everyone was talking about, andMicrosoft and Amazon are benefiting from it”, said Sid Parakh, a portfolio manager at Becker Capital Management, which has about $3 billion under management.
The company is also turning heads with its purchase-in-a-click Dash buttons, original Prime Video series, Echo gadgets and six-packs of Kindle tablets. The stock lost $4.01 to $72.50. On the Nasdaq, 1,633 issues rose and 664 fell. The service hosts IT infrastructure mainly for corporate accounts.
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It’s a Zacks Rank #2 stock. “There’s a lot of hand-wringing over third-quarter earnings and on balance they’ve been pretty good”. The Earnings ESP for this stock stands at +10.00%.
