The New York Stock Exchange was in the green on Friday, helped by the tech sector thanks to strong Netflix results, while Google’s job cuts were welcomed by investors.
The Dow Jones index, which has been fluctuating between the green and red equilibrium, is up 0.13% around 15:30 GMT, while the Nasdaq is up 1.17% and the S&P 500 is up 0.64%.
On Thursday, the Dow Jones index was down 0.76% to 33,044.56, as was the broader S&P 500 index at 3,898.85, while the heavily tech-tinted Nasdaq was down 0.96% to 10,852, March 27 stitches fell.
“After two consecutive sessions of decline, it looks like we will stabilize thanks to the technology that continues to be supported,” commented Spartan Capital’s Peter Cardillo.
Netflix surprised Thursday night after the market close by announcing a strong recovery in its subscriber base, which rose by 7.6 million in the most recent quarter alone, much more than Wall Street had expected.
Those numbers drove action up nearly 7%.
The streaming leader also appears to be entering a new era with the retirement of its founder Reed Hastings, who is stepping down as co-CEO to become “executive chairman”.
Following recently announced layoffs at Microsoft, Amazon, Meta, Twitter and others, it was Google’s turn to cut its workforce.
Parent company Alphabet has announced that it will cut 12,000 jobs worldwide, or 6% of its workforce. The action rose 5.15% to $98.75 around 15:30 GMT.
His boss Sundar Pichai justified the decision in an e-mail to employees by saying that after two years of “spectacular growth” and hiring “in a different economic context”, the situation is now forcing the group to reduce its workforce.
“Powerful tech professionals were hiring at a pace that was unsustainable and the deteriorating macro environment is now forcing them to lay off,” commented Dan Ives of Wedbush Securities.
Another company, Wayfair, an online furniture retailer that has been very successful in the US during the pandemic, also announced job cuts. The group will cut 10% of its workforce, i.e. 1,750 jobs.
As with the stock Alphabet, this cut in operating expenses was welcomed by investors, who praised the stock Wayfair (+11.63% to $43.44).
Little macro news was expected Friday, aside from home resale.
These posted their 11th month of decline in December, the first time since this data began being compiled in 1999. However, the 1.5% one-month drop at an annualized rate is less severe than expected.
In terms of valuation, the real estate sector lagged behind (-0.72%) while communications services, which include Google and Netflix, pranced at the top (+2.45%).
Notes of optimism from investors, according to Briefing.com’s Patrick O’Hare, included comments from European Commission Vice-President Valdis Dombrovskis, who believed a recession in Europe could be avoided given better-than-expected growth in the region.
The Eli Lilly laboratory was sanctioned (-1.26%) after the FDA rejected an expedited submission to the US Food and Drug Administration.
In the bond market, 10-year Treasury bill yields rose to 3.45% from 3.39% the previous day.