S&P 500 has its first close above 5,000 in another winning week for Wall Street

Wall Street’s rally got going with hopes that cooling inflation would get the Federal Reserve to dial down the pressure by cutting interest rates

A street sign for Wall Street is seen outside the New York Stock Exchange (NYSE) in New York City, New York, U.S., July 19, 2021.ANDREW KELLY (REUTERS)

Wall Street closed out its latest winning week with another milestone, the S&P 500′s first close above 5,000. The benchmark index rose 0.6%, marking its 14th winning week in the last 15. The Nasdaq composite rose 1.2%, pulling closer to its all-time high set in late 2021, as Big Tech stocks were some of the market’s strongest. Nvidia, Microsoft and Amazon all posted big gains. The Dow Jones Industrial Average was a laggard a day after setting its own all-time high, dipping 0.1%. Treasury yields held relatively steady in the bond market, helping to keep things smooth.

Another winning day on Wall Street has the U.S. stock market on track Friday for another record, another milestone and another winning week.

Wall Street’s rally got going with hopes that cooling inflation would get the Federal Reserve to dial down the pressure by cutting interest rates. Lately, such cuts look to be coming later than hoped because reports keep showing a remarkably solid economy. But that strength has in turn raised expectations for profits from companies, supporting stocks.

Cloudflare was the latest company to soar after reporting stronger profit than analysts expected for its latest quarter. The cloud-services company jumped 21.2% after it said it signed both its largest new customer and its largest renewal ever, despite an overall economic environment that “remains challenging to predict.”

Big Tech stocks were doing most of the market’s heavy lifting, as they’ve been doing for more than a year, in part on mania around artificial-intelligence technology. Nvidia, Microsoft and Amazon were three of the strongest forces lifting the S&P 500 after each rose at least 1.4%.

They helped offset a 2.9% drop for PepsiCo, which reported weaker revenue for the latest quarter than analysts expected. It said growth is slowing because customers are getting back to their snacking and other behaviors from before the pandemic.

Expedia tumbled 17.8% despite also reporting stronger profit than expected. Analysts pointed to some forecasts by the company for measures for the first three months of 2024 that point to slower bookings growth. The company also announced a new CEO, Ariane Gorin, will take over in May.

Take-Two Interactive, the publisher of “Grand Theft Auto” and other video games, sank 8.1% after it reported weaker profit than expected. It also cut its forecast for results for its fiscal year, which ends at the close of March.

Profits have largely been coming in better than expected for big companies in the S&P 500 this reporting season, which is roughly two-thirds done. That’s usually the case, but even more companies than usual are doing so this time around, according to FactSet.

S&P 500 companies look to be on track to report 3% growth in earnings per share from a year earlier. That’s a modest figure, but it would be just a second straight quarter of growth following several quarters of declines.

That has helped optimism rise on Wall Street, but contrarians say it might have gone too far and carried stocks to too-expensive heights.

Traders are flowing into some riskier investments at a quick enough pace that a contrarian measure kept by Bank of America is leaning more toward “sell” now than “buy,” though it’s not at convincing levels. The measure tracks how much fear and greed are in the market, and it suggested buying in October when fear was at a convincing high.

In the bond market, Treasury yields were inching higher, but movements were calmer than earlier in the month when they were jumping as traders forcefully pushed out their forecasts for rate cuts.

The yield on the 10-year Treasury rose to 4.16% from 4.15% late Thursday. Earlier this month, it was at just 3.85%.

It’s an encouraging signal that the stock market can continue to hit highs even as expectations dim for an imminent cut to interest rates, particularly after the market seemed to be moving solely on such forecasts.

“A less emotional market is a positive sign, though investors must fight against the complacency that is a natural reaction to such a strong and steady bull run,” said Mark Hackett, Nationwide’s chief of investment research.

In stock markets abroad, indexes were relatively quiet and mostly lower. In Asia, several markets were shut for the Lunar New Year holiday.

Tokyo’s Nikkei 225 edged up by 0.1% after touching a 34-year high earlier in the day.

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