US Stocks Close Marginally Higher After Initial Losses
New York, January 29, 2025 - US stocks recovered from morning losses to close slightly higher on Wednesday, led by gains in the tech-heavy Nasdaq Composite.
Earnings Disappoint, Nvidia Rises
Mixed earnings reports from Alphabet (GOOG) and AMD (AMD) contributed to early market declines. Alphabet's cloud revenue missed expectations, while AMD's guidance on AI revenues disappointed. However, Nvidia (NVDA) shares surged over 5%, offsetting the losses.
Tariff Concerns and Interest Rates
Ongoing tariff concerns between the US and China continued to weigh on sentiment. President Donald Trump's plans for a potential tariff increase have raised uncertainty in the markets. Meanwhile, the 10-year Treasury yield fell nine basis points to 4.42%, its lowest level since December 2024, boosting interest rate-sensitive sectors.
Sector Recap
The Dow Jones Industrial Average (DJI) led the gains, rising 0.7% or over 300 points. The Nasdaq Composite (IXIC) rose 0.2%, while the benchmark S&P 500 (GSPC) gained 0.4%. Technology, real estate (XLRE), and utilities (XLU) sectors outperformed, while the energy sector declined.
Key Developments
* Big Tech companies Alphabet, Microsoft (MSFT), and Meta (META) announced a combined capital expenditure of $230 billion for 2025, driven by investments in artificial intelligence.
* Disney (DIS) reported strong earnings, with its streaming segment swinging to profit, despite setbacks in its parks business.
* Apple (AAPL) shares fell after news that China is investigating its App Store practices.
Outlook
Market analysts remain cautious amid ongoing tariff negotiations and concerns over the potential impact on tech and chip companies. However, the recent decline in the Treasury yield has provided some support to interest rate-sensitive sectors.