Stock market today: Dow racks up gains on Netflix surge, but ends week in red
By Yasin Ebrahim
Investing.com -- The Dow ended lower for the week Friday, despite a Netflix-fueled rally after the streaming giant's quarterly results showed a rebound in subscriber growth.
The Dow Jones Industrial Average gained 1%, or 330 points, but ended the week lower. The S&P 500 rose 1.89%, and the Nasdaq Composite was up 2.7%.
Netflix’s lower-than-expected quarterly earnings were offset by subscriber additions of 7.5 million that far exceeded expectations for 4.5M. The trend of subscriber growth is likely continued, led by the streaming giant’s new advertising tier.
“The important takeaway is that the new ad-supported tier resulted in retention of subscribers,” Wedbush said in a note, following Netflix’s results. “We expect this phenomenon to repeat itself in the coming year, with the result that we expect Netflix (NASDAQ: NFLX ) to return to subscriber growth of 17M new users per year.”
Alphabet (NASDAQ: GOOGL ) also racked up gains to help tech advance as investors cheered news the tech giant will cut costs by axing about 12,000 jobs.
The move in tech stocks has the runway to continue, some say, as investors are expected to continue rotating away from defensive positions.
“These short-term developments suggest investors are rotating away from the defensives- and that a 'risk-on' bias can continue to return even as we move through earnings season and the threat of recession weighs on investors,” Janney Montgomery Scott said.
Financials were also in the ascendency powered by a more than 16% rise in SVB Financial Group (NASDAQ: SIVB ) as Wells Fargo talked up the Silicon Valley bank, saying it “remains the trusted partner of the innovation economy."
Ally Financial (NYSE: ALLY ), meanwhile, reported quarterly results that beat on both the top and bottom lines, sending its shares 20% higher.
Elsewhere on the earnings front, PPG Industries Inc (NYSE: PPG ) reported in-line earnings and revenue that topped estimates as the paint and coatings maker's price hikes boosted margins.
Treasury yields , meanwhile, continued to rise even as Federal Reserve officials continued to support further slowing rate hikes ahead of a meeting next month.
In other news, the Federal Reserve is reportedly probing Goldman Sachs' (NYSE: GS )’ consumer business, Marcus, amid concerns the bank may have failed to implement proper monitoring and safety frameworks to protect customers.
The weekly loss in the broader market comes after data earlier this week including weaker retail sales flagged recession concerns at a time when many worry the Fed may overshoot on policy tightening, tipping the economy into recession.
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