S&P 500 Reaches New Record High Just Shy Of 5,000

Stocks have moved mostly higher during trading on Wednesday, with the major averages adding to the modest gains posted in the previous session. With the upward, the S&P 500 has reached a new record intraday high just shy of 5,000.

Currently, the major averages are just off their highs of the session. The S&P 500 is up 33.03 points or 0.7 percent at 4,987.26, the Nasdaq is up 111.10 points or 0.7 percent at 15,720.10 and the Dow is up 167.20 points or 0.4 percent at 38,688.56.

The strength on Wall Street may partly reflect recent upward momentum, which contributed to a substantial rally late last week despite waning optimism about the Federal Reserve cutting interest rates in March.

While CME Group’s FedWatch Tool suggests the chances of March rate cut are just 21.5 percent, the Fed is still expected to begin lowering rates sometime in the coming months.

Recent upbeat economic data has seemingly reduced the likelihood of a near-term rate cut but a strong economy is still seen as a net positive for stocks.

A positive reaction to some of the latest earnings news has also generated buying interest, with shares of Enphase Energy (ENPH) soaring by 17.6 percent after the solar inverter maker reported weaker than expected fourth quarter revenues but said it expects demand to improve throughout 2024.

Auto giant Ford (F) has also jumped by 2.0 percent after reporting better than expected fourth quarter results, providing upbeat guidance for 2024 and announcing a supplemental dividend of 18 cents per share.

On the other hand, shares of Snap (SNAP) have plummeted by 34.4 percent after the Snapchat parent reported mixed fourth quarter results and forecast first quarter sales below analyst estimates.

In U.S. economic news, the Commerce Department released a report this morning showing the U.S. trade deficit widened in the month of December.

The Commerce Department said the trade deficit increased to $62.2 billion in December from a revised $61.9 billion in November.

Economists had expected the trade deficit to narrow to $62.2 billion from the $63.2 billion originally reported for the previous month.

Sector News

Software stocks are turning in some of the market’s best performances on the day, driving the Dow Jones U.S. Software Index up by 1.4 percent to a record intraday high.

Considerable strength is also visible among housing stocks, as reflected by the 1.4 percent gain being posted by the Philadelphia Housing Sector Index.

Semiconductor stocks are also seeing a significant rebound after moving notably lower on Tuesday, while banking stocks have moved to the downside on the day.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance on Wednesday. China’s Shanghai Composite Index surged by 1.4 percent, while Hong Kong’s Hang Seng Index fell by 0.3 percent and Japan’s Nikkei 225 Index edged down by 0.1 percent.

Meanwhile, the major European markets have all moved to the downside on the day. While the French CAC 40 Index has dipped by 0.2 percent, the German DAX Index and the U.K.’s FTSE 100 Index are down by 0.5 percent and 0.6 percent, respectively.

In the bond market, treasuries have shown a lack of direction over the course of the morning. Currently, the yield on the benchmark ten-year note, which moves opposite of its price, is up by less than a basis point at 4.096 percent.