The stock market exhibited some rebound action after a soft start to the month. It was a busy week, featuring earnings results from nearly 40% of the S&P 500 and some key economic releases. The Dow Jones Industrial Average rose 0.7%, the S&P 500 gained 2.7%, and the Nasdaq Composite surged 4.2% higher this week. The upside was fueled by favorable responses to earnings from mega cap stocks, and a calmer week for Treasuries.
Broad buying activity left the equal-weighted S&P 500 up 1.6% this week and all 11 S&P 500 sectors finished higher. Mega cap gains had an outsized impact on index performance, though, and drove gains in the information technology (+5.1%), consumer discretionary (+3.5%), and communication services (+2.7%) sectors. The quarterly reports from some of the mega caps fueled positive buzz around AI, especially benefiting the semiconductor sector. The PHLX Semiconductor Index (SOX) jumped 10% this week.
Meta Platforms (META) was an exception from the mega cap space, dropping 7.9% this week after reporting earnings. Microsoft (MSFT), Alphabet (GOOG), which hit a new all-time high, and Tesla (TSLA) gained 1.8%, 11.5%, and 14.4%, respectively, in response to their earnings news.
Investors were also digesting the Advance Q1 GDP report, which showed weaker growth and higher inflation, and the weekly jobless claims report, which showed ongoing strength in the labor market, and the March Personal Income and Spending report, which that showed solid spending activity, but stalled progress on inflation.