Wall Street bonuses poised to hit record as annual profits forecast to top US$90 billion
Annual earnings would comfortably surpass last year’s record of US$65.1 billion, according to a report
The US stock market is currently characterized by technology stocks, which are propelling Wall Street to record highs. Chipmaker Nvidia is leading the way, bringing the Dow Jones Industrial Average slightly higher at 51,429 points. The S&P 500, a broader market index, gains 0.5 percent, reaching 7,817.81 points, marking a new high.
The technology-focused Nasdaq index also gains 0.6 percent, closing at 27,644 points, with the Nasdaq 100, a measure of the 100 largest non-financial companies, up 0.7 percent at 31,264 points. The rise in tech stocks is fueled by Nvidia's record-breaking performance. Optimism about future earnings and a record share buyback are boosting investor sentiment.
Nvidia's market capitalization is nearing six trillion dollars, making it the world's most valuable company. Analyst Larry Tentarelli from Blue Chip Daily notes that when interest rate hikes become more likely, capital flows into tech stocks due to their resilience against interest rate hikes. Analysts emphasize the interest rate outlook, with Nvidia currently viewed as a comparatively safe haven against rising interest rates.
The expectation of only one interest rate hike this year is driving investors towards tech stocks, according to Senior Financial Market Analyst Kyle Rodda from capital.com. "The slight decrease in uncertainty about the interest rate outlook and a slight easing of geopolitical tension, evident in falling crude oil prices, has allowed market participants to focus on the extraordinary profit growth in the AI sector."
Despite the tense situation in the Middle East, the oil price remains stable as of Tuesday, with Brent crude oil for delivery in December trading 2 percent lower and just under the 100-dollar mark per barrel (159 liters). US Light Oil WTI for November delivery also fell 2.1 percent to 87.52 US dollars per barrel. Meanwhile, the yield on 30-year US Treasury bonds fell to 5.626 percent, down from a peak of 5.702 percent the previous day.
Individual stock performance includes tech stocks, with Advanced Micro Devices up 2 percent and Broadcom up about 1 percent. Semiconductor manufacturer AMD is also gaining, with a 2.6 percent increase as it responds to high demand for computer chips by expanding production.
Written by urgent.news from Handelsblatt's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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