Boosted by a crop of big-tech earnings that shattered Wall Street expectations, stocks are once again hitting highs Thursday as a slew of new economic data shows that the long-awaited economic recovery is picking up steam.
Shortly after the market opened, the S&P 500 climbed 0.8%, crossing 4,200 points for the first time ever, while the tech-heavy Nasdaq, which closed at a new high Monday for the first time in two months, also extended its record, jumping 0.8%.
Despite its recently tepid performance—due largely to underperforming stocks like Boeing and Amgen—the Dow Jones Industrial Average also moved higher, jumping 148 points, or 0.4%, to land about 0.5% below a record high from earlier this month.
Heading up gains in the S&P, shares of Facebook are soaring more than 7% after the social media giant blew past analyst expectations with its first-quarter report after Wednesday’s close; the company posted revenue of more than $26 billion and its highest monthly user level ever.
Shares of Apple—the world’s most valuable company with a market cap of nearly $2.3 trillion—are also rising after an earnings report that far exceeded expectations, as revenue shot up nearly 54% to a record $89.6 billion thanks to blowout iPhone sales.
Though it also beat earnings expectations, Ford is falling 4% after it warned in its late-Wednesday earnings report that the global chip shortage plaguing several industries will shrink the company’s expected second-quarter production by about 50% and only “get worse before it gets better.”
Bolstered by pent-up demand, stimulus checks and the vaccine rollout, the U.S. economy grew at a 6.4% annualized rate in the first quarter of last year—exceeding economist projections of about 6% and marking a solid increase from 4.3% growth in the previous quarter.
Another sign the economy could come back full force, first-time unemployment claims last week sank to a new pandemic low of 553,000—13,000 fewer claims than one week prior, though a staggering 16.6 million people are still receiving some form of unemployment benefit.
“Mega-cap technology firms are having a phenomenal reporting season—with Apple, Facebook and Alphabet all crushing expectations,” Vital Knowledge Media Founder Adam Crisafulli said in a Thursday morning note. “That said, expectations are already very high, which is why companies with ostensibly great results are struggling to rally… Even Microsoft [which fell 3% after earnings[ really wasn’t that bad—it just wasn’t as impressive as some of its super-cap peers.”
What To Watch For
Next on deck for big-tech earnings are Amazon and Twitter, which report after Thursday’s close.