Wall Street closed firmer on Friday, driven by strong gains in the tech sector after Netflix (NASDAQ:NFLX) released an upbeat earnings report. The S&P 500 climbed 0.30% and the Dow edged up, both hitting new records, while the Nasdaq 100 advanced 0.70%. Trading Economics reported that Netflix climbed 11% after reporting better-than-expected Q3 earnings, revenue, and subscriber growth. Apple shares (NASDAQ:AAPL) also rose 1.20% after a report indicated a spike in iPhone sales in China. Nvidia (NASDAQ:NVDA) (0.70%), Amazon (NASDAQ:AMZN) (0.70%), and Alphabet (NASDAQ:GOOGL) (0.30%) also posted gains. However, Procter & Gamble (NYSE:PG) dipped slightly after missing sales forecasts, and American Express (NYSE:AXP) fell 3.10% due to disappointing revenue. For the week, the S&P 500 rose 0.20%, the Dow gained 1.20%, marking its sixth straight weekly gain and the longest winning streak of 2024, while the Nasdaq 100 lost more than 0.70%.
European stocks gained momentum on Friday, buoyed by expectations that the European Central Bank will continue cutting interest rates and positive news for companies with significant exposure to China. The decision by the People’s Bank of China (PBoC) to launch two new liquidity-boosting initiatives aimed at purchasing stocks boosted the European luxury and automotive sectors. Trading Economics reported that “LVMH (EPA:LVMH), Hermes (EPA:HRMS), and Kering (EPA:PRTP) added between 3.50% and 1% to trim their selloffs from earlier in the week, while Volkswagen (ETR:VOWG_p), BMW (ETR:BMWG), and Mercedes (ETR:MBGn) added between 1.40% and 0.70%. Also, ASML (AS:ASML) advanced by nearly 4% to slightly pare its aggressive selloff this week, driven by the poor guidance after its earnings report.”
The Shanghai Composite jumped 2.91%, while the Shenzhen Component surged 4.71% on Friday, rebounding from the previous session’s losses. “This came after China’s central bank introduced a lending program to support share buybacks by qualified companies and opened a swap facility to enhance financial firms' liquidity,” Trading Economics reported. The PBoC also indicated the possibility of lowering banks' reserve requirements again by year-end, depending on liquidity needs. These measures provided a boost to investor sentiment, following the recent stimulus rally losing steam amid weak fiscal policy from Beijing. Additionally, data showed China’s economy grew more than anticipated in the third quarter, although at the slowest rate since 1Q23.
The FTSE/JSE All Share Index (ALSI) climbed 0.70% to close at 87 201 points on Friday, its highest level since late September, fuelled by a 2.40% increase in tech stocks. Resource-linked and industrial stocks also posted gains of 1.30% and 0.60%, respectively. Investors weighed corporate earnings from global firms alongside China's new stimulus efforts in response to weak economic data. Domestically, attention turned to the upcoming CPI inflation data, which could influence the central bank's future interest rate decisions. For the week, the ALSI advanced 1.20%.
Gold surpassed the $2 700/oz mark for the first time on Friday, driven by increased safe-haven demand amid US election uncertainty and ongoing tensions in the Middle East. A more relaxed monetary policy environment also contributed to the rally. Spot gold gained 2% over the week.
Crude oil futures stabilised, following robust US retail sales data, though mixed Chinese economic indicators persisted, and prices were on track for their largest weekly decline in over a month due to demand concerns. Brent crude futures rose by 0.10% to $74.53 per barrel at the close of local business on Friday.
