Hamza Shaban
Stock market today: S&P 500 sets record, longest weekly win streak of 2024 as Netflix surges
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US stocks notched records and extended impressive streaks Friday as Netflix (NFLX) delivered powerful earnings and set the stage for Big Tech's corporate results in the coming days.
The S&P 500 (^GSPC) added about 0.4% and recorded a fresh all-time high, as well as its sixth straight week of gains, the longest streak in 2024. The tech-heavy Nasdaq Composite (^IXIC) moved up 0.6%, leading gains. The Dow Jones Industrial Average (^DJI) rose 0.1% after hitting a new closing high the day before.
The major stock gauges logged weekly wins after a strong showing by big banks to kick off earnings season. The Dow grabbed the top of the weekly chart, adding 0.9%, followed by the S&P 500, which increased 0.8%, and the Nasdaq's 0.7% gain.
Netflix's results late Thursday relieved some worries that Big Tech names might struggle in the third quarter as they did in the last. The streaming giant's profit surged to outstrip Wall Street estimates, while revenue and subscriber growth also came in stronger than expected. Its shares jumped around 11%.
In commodities, gold (GC=F) prices hit a record, topping $2,700 an ounce. Concerns about the Middle East conflict and uncertainty about the outcome of the US presidential election prompted a shift to less-risky assets.
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The case against economic reacceleration
After a strong September jobs report, robust retail sales figures, and other recent economic data that came in stronger than expected, some market observers have pivoted from worrying about a potential recession to the possibility of a reacceleration.
As Bank of America analysts wrote in a note on Friday, some investors worry that the Federal Reserve's new easing policy could spark inflationary pressures to heat up again. Officials are trying so hard to prevent an economic slowdown, the thinking goes, that they have increased the risk of running the economy too hot.
But the Bank of America analysts make the case that such concerns are overdone. They point to the "steady, if somewhat slow, disinflation" trend over the last several quarters and a Fed that appears ready to respond to any sign of reignited price pressures.
"Fed commentary after the GDP and jobs data has been much less dovish, suggesting that policymakers are vigilant to upside risks," said the report. "Should those risks start to materialize, we think the Fed will partially mitigate them by slowing or even ending the cutting cycle."
Single-family housing starts ramped up in September as mortgage rates fall
Single-family housing starts gained in September from the previous month amid lower mortgage rates.
The measure rose 2.7% to a seasonally adjusted annual pace of 1.027 million units, the strongest pace in five months, according to new data from the Census Bureau.
The increase came as mortgage rates slid steadily last month, pushing the average 30-year fixed loan to its lowest level since early February 2023. The Fed cut its benchmark rate by half a percentage point in September.
Lower rates likely encouraged builders to file more building permits during the month. Contract permits for single-family dwellings rose to a pace of 970,000, a 0.3% gain from August’s revised figure of 967,000 units.
October’s data could reveal a different story, given that mortgage rates have ticked back up.
“While single-family home building increased in September, higher mortgage interest rates in October are likely to place a damper on growth in next month’s data,” NAHB’s chief economist Robert Dietz wrote in a note after the release.
Overall, housing starts eased in September, pressured by a drop in multifamily construction. Housing starts slipped 0.5% from the previous month to a seasonally adjusted annual pace of 1.354 million units.
