4:13pm: Major indexes end mixed
The Dow closed Friday up 3 points at 35,228, while the Nasdaq Composite lost 31 points, 0.2%, to 14,033 and the S&P 500 added 1 point to 4,536. The small-cap Russell 2000 index declined 6 points, 0.3%, to 1,961.
It was a narrow gain, but the DJIA managed to secure a 10-session winning streak for the first time since 2017. Investors have largely liked what they've seen from earnings this week, sending markets higher, albeit with some tech headwinds on the Nasdaq on Friday.
″...overall, early Q2 results appear good enough for equity markets to grind higher for now,” Barclays analyst Emmanuel Cau wrote in a Friday note. “Next week will be more indicative of the broad earnings dynamics, with ~50% of market cap reporting.”
12:05pm: Dow on track for 10 straight days of gains
US stocks were higher in noon trading as tech stocks recovered and the Dow continues to plough ahead.
At midday, the Dow gained 89 points to 35,314, while the S&P 500 added 14 points at 4,549 and the tech-heavy Nasdaq rose 22 points to 14,085.
“Investors seem to put aside disappointing results by Netflix and Tesla which provoked Thursday's rout and instead focus on next week's Alphabet, Microsoft and Intel earnings among a plethora of others,” IG senior market analyst Axel Rudolph said.
Notable movers included shares of CSX Corporation, which fell 4% after the transportation company missed analyst expectations for revenue in the second quarter.
9:45am: Volatility around earnings
US stocks moved higher at the open on Friday as tech stocks recovered from a battering led by investor pullback on Tesla and Netflix following their latest earnings reports.
Just after the opening bell, the Nasdaq had added 94 points or 0.7% at 14,158 points, the S&P 500 was up 18 points or 0.4% at 4,553 points, and the Dow Jones had added 79 points or 0.2% at 35,305 points.
DHF Capital asset manager Bas Kooijman noted that, as earnings contribute to US stock volatility, there could also be price corrections after the continuous gains of the last few months.
“In particular, traders could become more cautious before the Federal Reserve’s meeting next week and could move to secure their gains,” he said.
“If a more stable outlook for interest rates is confirmed, the stock market could record a stronger performance. This could come in addition to reduced concerns about a potential recession.”
7:45am: Is the Dow's winning streak over?
US stocks are forecast to open mixed on Friday, with the Dow Jones Industrial Average (DJIA) expected to nudge lower after notching up a ninth day of wins on Thursday, its best run of gains since 2017, with corporate earnings remaining the main focus.
In pre-market trading, futures for the DJIA were down 0.03%, but those for the S&P 500 added 0.2%, and Nasdaq 100 futures gained 0.4%.
The main US indexes put in a mixed session on Thursday, with the DJIA advancing nearly 164 points, or 0.5%, to end at 35,225, its highest close since March 2022. But the S&P 500 lost 0.7% and the Nasdaq Composite dropped 2.0%.
The DJIA was boosted on Thursday by strong earnings from Johnson & Johnson, but post-results slides from Netflix and Tesla shares weighed on the other two indexes.
The DJIA and S&P 500 are on pace to finish the week up about 2.1% and 0.7%, respectively, while the Nasdaq is currently set to end 0.4% lower for the week.
Neil Wilson, chief market analyst at Markets.com commented: "Bubble popping or just index rotation? Tech fell sharply in the US yesterday, whilst defensives like healthcare and utilities rose along with energy and financials as yields climbed. The S&P 500 finished lower by almost 0.7%, whilst the Dow’s 9th straight up day is the best run since 2017. NDX had a big down day, falling 2.28%, as tech took a beating with Tesla -10% and Netflix -8% on earnings. An out-of-cycle rebalance designed to reduce the weightings of the largest names in the index will add fuel to a spiky options expiry day today – estimates suggest about $2.4tn notional tied to US equity options."
He added: "Why rebalance? Nvidia, Microsoft, Alphabet, Amazon, Apple, and Tesla have risen by an average 60% YTD and now make up 50% of the Nasdaq 100. Nvidia will go from 7.28% of the index to 4.30%; Microsoft from 12.74% to 9.80%; and so on, effective July 24th. In all it will mean these six stocks don’t make up more than 40% of the NDX. I don’t think it amounts to a hill of beans – the Nasdaq 100 is already a kind of weird tech bubble measure. But a case in point – NDX equal weight declined by around half the amount the market cap-weighted index did yesterday."
On the corporate front Friday, results are expected from the likes of American Express and Schlumberger. Transportation stocks CSX and Knight-Swift fell 4% and 3%, respectively, in after-hours trading after their earnings underwhelmed Wall Street analysts.
So far, however, it has been a generally strong earnings season thus far, with 73% of S&P 500 companies that have already reported exceeding analysts’ expectations, according to FactSet data.