Stocks Surge to Best Weekly Performance Since November Inauguration

Wall Street Summary

US stocks rallied to record their best weekly performance since the November presidential election, buoyed by positive earnings, easing inflation data, and news of potential trade discussions between the US and China. The S&P 500 gained 2.9%, the Nasdaq 100 rose 1.7%, and the Dow Jones Industrial Average added 0.8% for the week.

Sector Performance

Most sectors in the S&P 500 advanced, with technology and financial stocks leading the gains. Nvidia and Tesla were among the top performers among megacaps, while Intel jumped over 9% after reports of a potential acquisition. Banks continued to surge, sending an industry gauge up 8.2% for the week.

Earnings Season

Earnings season has been a positive catalyst for stocks, with companies reporting strong results. Microsoft's $13 billion investment in OpenAI raised concerns about increased dominance in AI. Uber Technologies' revenue surpassed estimates, and Disney reported strong streaming growth.

Market Sentiment

Market sentiment has improved following easing inflation data and recent Fed signals. Oversold conditions and weak bullish sentiment underpinned the rally in major indices. Analysts expect market volatility to continue during earnings season, but remain optimistic about long-term gains.

Trump Inauguration

Stock investors breathed a sigh of relief ahead of Trump's second inauguration. Historically, the S&P 500 has performed better in the three months after an inauguration. Bank of America strategists believe Trump's protectionist agenda and tax proposals will shield US stocks from a significant selloff.

Global Markets

The MSCI World Index rose 0.8%, while the Bloomberg Magnificent 7 Total Return Index gained 1.8%. European stocks advanced as well, with Germany's DAX 30 and France's CAC 40 both posting gains.

Currencies and Commodities

The US dollar strengthened against major currencies. Crude oil prices declined slightly, while gold fell below $2,700 an ounce.

Disclaimer: This information is provided for informational purposes only and should not be construed as financial advice.