Hi, dear traders! The US stock market opened on a positive note as expected. The benchmark stock indices closed with confident gains on Tuesday.

The Dow Jones logged modest intraday gains yesterday, having climbed by 254 points or 0.76%. The Nasdaq again showed the strongest growth, having closed 2.01% up. The S&P 500 rose 47 points or 1.19% to close at 4,019.
The New York pre-market was less promising. The major indices traded mainly lower. The S&P 500 is expected to trade in the intraday corridor between 3,970 and 4,060.
Wall Street closed with sharp gains yesterday amid a rally in high-tech stocks, in particular the shares of semiconductor companies. The sector used to be weighed down for a long time and finally recovered.

Philadelphia SE, a semiconductor index, jumped by 5.0%, the sharpest intraday growth since November 30 after Barclays upgraded the sector’s rating.

Tesla shares spiked by 7.7% after CEO Elon Musk testified in a federal civil trial about the fraud case related to the tweet saying that he advocates for taking the e-car company private.

The shares of Salesforce, the cloud software developer, rose by 3.1% after the news that Elliot Management Corp purchased a stake worth billions of dollars.

Spotify joined the list of companies that announced massive lay-offs. The company aims to fire 6% of its employees for obvious reasons: a looming recession and high interest rates. The shares of the music streaming company grew by 2.1%.

Almost all of 11 sectors in the S&P 500 gained ground, except the energy sector. The high-tech shares logged the biggest gains, having climbed by 2.3% intraday.

Today the market is taking a breather ahead of more corporate reports and a series of macroeconomic data that will be on tap on Thursday and Friday. The market is anticipating the US GDP data and a personal spending survey.  

Today investors are digesting indicators of business activity. The EU manufacturing and services PMIs for January resumed growth for the first time since June. The US PMIs will be released tonight.

As for corporate reports, 57 companies included in the S&P 500 have already unveiled their financial records. According to Refinitiv, 63% of them reported higher-than-expected profits. Now analysts predict that the aggregate profits of the S&P 500’s companies will decline by 3% in the fourth quarter on year, almost twice worse than a 1.6% annual fall in the first quarter.

Microsoft will present its report later today. Investors will focus on spending and job cuts in the high-tech sector.

Analysts say that demand for cloud technologies was boosted by teleworking and distant learning during the pandemic. Recently, demand has been declining in the last 9 months which means a fall in sales.

Microsoft shares rose on Monday after the company announced multi-billion-dollar investments in the artificial intelligence lab OpenAI, reinforcing connections with the sensational chat bot ChatGPT.

The oil service company Halliburton reported stronger-than-expected profits for the fourth quarter. The report proves that the oil rally encourages drilling activity and boosted demand for drilling services and machinery.

Johnson & Johnson posted an optimistic forecast of the annual profit beyond Wall Street forecasts. The company expects high demand for medicines, in particular the drug against cancer.


Besides, investors are alert to reports by US defense companies such as Lockheed Martin and Raytheon which are expected to show upbeat results.
The US dollar index regained its footing and climbed above 102. At the same time, the overall sentiment on the greenback has turned sour. Having dipped by 0.08% in the pre-market, the index is trading at 102.03 within the intraday corridor between 101.5 and 102.3.
The greenback remains under selling pressure as traders are looking forward to the Fed’s policy meeting. Investors are betting on the modest rate hike next week, even though the central bank is still committed to its fight against high inflation.

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