Wall Street Optimistic: US Stock Markets Approach Record Highs

Investors at the American stock exchanges breathed a sigh of relief on Thursday as the latest inflation figures met their expectations, prompting a rally in key indices. Particularly, cyclical technology stocks experienced a notable price increase, while the overall market sentiment was characterized by positive anticipation. The Dow Jones Industrial, a leading benchmark of the U.S. stock market, recorded a slight increase of 0.12 percent to 38,996.39 points, representing a significant monthly gain of 2.2 percent. The S&P 500 saw an even larger rise, climbing by 0.52 percent to 5,096.27 points. The Nasdaq 100, known for its technology-heavy composition, logged a gain of 0.95 percent, closing at 18,043.85 points. In January, U.S. inflation data provided relief to investor sentiment as the upward price trend continued to show moderate signs, as hoped. The PCE price index, which the Federal Reserve views as an important indicator, increased by 2.4 percent year-on-year, a noticeable decrease compared to the 2.6 percent in the previous month of December. The core rate, which excludes energy and food, also dropped from 2.9 to 2.8 percent. Meanwhile, as the earnings season was in full swing, Salesforce's stock climbed three percent due to an impressive earnings forecast despite less positive revenue expectations, marking a leading performance within the Dow. In contrast, Snowflake faced a sharp decline of over 18 percent, caused by a similarly bleak revenue forecast and the resignation of their CEO. Monster Beverage impressed with outstanding gross margins; its stock jumped nearly six percent. AMD even achieved a record high, leading the Nasdaq 100’s gainers with a robust increase of almost nine percent. Citigroup expressed confidence in the semiconductor sector’s prospects, which is expected to continue enjoying strong tailwinds due to dynamics surrounding Artificial Intelligence. Nonetheless, AMC Entertainment suffered heavy losses of more than 13 percent after disappointing business performance led to a reduction in the intended compensation for CEO Adam Aron. Shares of WW International, the company behind Weight Watchers, plunged to an all-time low, losing a substantial 18 percent at the close after both the revenue forecast was met with displeasure and the announcement from Oprah Winfrey, who ruled out running again for the board. On the currency front, the euro came under slight pressure and was last traded at 1.0806 U.S. dollars in New York. In turn, U.S. government bonds saw slight price increases; the futures contract for ten-year bonds rose by 0.01 percent to 109.83 points, while the yield for ten-year papers fell to 4.26 percent.