Nasdaq Extends Record on Google, Amazon Results; Dollar Declines

Updated on
Breaking Down the Nasdaq’s Record High

The Nasdaq Composite Index extended gains after closing at a record as Google Inc. and Inc. rallied on results. Treasuries rose after capital goods orders unexpectedly fell, while oil retreated in New York.

The Nasdaq jumped 0.7 percent at 4 p.m. in New York after topping its March 2000 record Thursday. The Stoxx Europe 600 Index added 0.3 percent, while Brazil’s Ibovespa extended gains from a January low to 21 percent. The Bloomberg Dollar Spot Index dropped 0.3 percent and 10-year Treasury yields fell five basis points to 1.91 percent. The rate on 10-year Greek bonds rose 36 basis points to 12.66 percent as frustration mounted in talks over funding for the country. Iron ore entered a bull market.

The Nasdaq Composite has almost quadrupled since global equity markets bottomed in March 2009. Microsoft Corp. surged Friday after results topped estimates, while Google’s revenue grew amid an increase in advertising. The unexpected drop in orders for business equipment added to evidence that growth in the first quarter slowed, bolstering the case against raising interest rates.

“It’s very positive that this time you actually have good tech earnings to support the Nasdaq record,” said Manish Singh, who helps oversee $2 billion as head of investments at Crossbridge Capital in London. “The U.S. earnings season overall is turning out to not be so bad.”

U.S. stocks capped a weekly increase, with the Nasdaq rising all five days to add 3.3 percent and the Standard & Poor’s 500 Index rising 1.8 percent to close at an all-time high.

Earnings Scorecard

Of the companies in the index that have reported results this season, 76 percent beat profit projections and 51 percent exceeded sales estimates. Results from Apple Inc. and Pfizer Inc. are due next week. jumped 14 percent as its quarterly sales beat projections. Starbucks Corp. and Juniper Networks Inc. rallied more than 5 percent as they posted better-than-forecast quarterly revenue. Xerox Corp. lost 8.7 percent after cutting its full-year profit forecast.

Treasuries rose after orders for business equipment unexpectedly fell in March for a seventh consecutive month. Federal Reserve officials have held their benchmark near zero since 2008 to support the economy. Policy makers meet next week in Washington.

The euro strengthened 0.4 percent to $1.0868 as the dollar weakened versus all of its 16 major counterparts.

Euro-area finance ministers met with Greek Finance Minister Yanis Varoufakis in Riga, Latvia. Varoufakis said the two sides have come “much closer together” and Greece is aiming for a deal as soon as possible.

HSBC Headquarters

Europe’s Stoxx 600 capped a 1.2 percent weekly gain, and banks climbed the most among 19 industry groups on Friday. HSBC Holdings Plc rose 2.9 percent, the most in more than a year, after Europe’s largest bank started a review of where its headquarters should be. Renault SA jumped 3.7 percent after saying quarterly sales rose 14 percent.

The MSCI Emerging Markets Index added 0.8 percent, extending a fourth weekly advance to 1.8 percent in the longest run in more than three months.

The Ibovespa rose 1.8 percent, extending the rally from a Jan. 30 bear-market low to 21 percent. Petroleo Brasileiro SA led gains in the span, jumping 68 percent after announcing a divestment plan and releasing delayed 2014 results.

The Shanghai Composite Index slipped 0.5 percent, trimming its seventh week of gains to 2.8 percent. The Hang Seng China Enterprises Index was little changed and is down 1 percent in the five-day period.

China’s stocks fell on Friday after the securities regulator increased the pace of initial public offerings, spurring concern new equity sales will divert funds from existing shares.

Oil, Gold

West Texas Intermediate crude fell 1 percent to settle at $57.15 a barrel in New York, trimming its sixth weekly gain, the longest winning streak since February 2014. Brent crude rose to $65.28, capping a 2.9 percent gain in the week.

Iron ore gained as BHP Billiton Ltd. curbed expansion plans and supply from high-cost mines fell. Ore with 62 percent content at Qingdao advanced 5.5 percent to $57.81 a dry metric ton on Friday, according to Metal Bulletin Ltd.

Gold futures tumbled the most in seven weeks, slipping 1.6 percent to settle at $1,175 an ounce as investors await next week’s Fed meeting amid signs of uneven growth in the U.S. Copper rose 1.4 percent and was down 0.6 percent on the week amid concern that a slowdown in China’s economy is lowering demand in the largest consumer of metals.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE