Business
Amazon laid off over 14,000 people this week—but Wall Street is loving it anyway
The S&P 500 rose 0.6%, erasing much of its slump from the day before and nearing its all-time high set on Tuesday. The index is on track to close a third straight winning week and a sixth straight winning month, which would be its longest monthly winning streak since 2021.
The Dow Jones Industrial Average was up 37 points, or 0.1%, as of 9:35 a.m. Eastern time, and the Nasdaq composite was 1.3% higher.
Amazon led the way after jumping 11.6%. The retail giant was by far the strongest force lifting the S&P 500 after reporting profit for the latest quarter that blew past analysts’ expectations. CEO Andy Jassy said growth for its booming huge cloud-computing business has reaccelerated back to a pace it hasn’t seen since 2022.
Apple also helped lift the market after its stock added 0.3%. It likewise delivered a better profit report than analysts expected, though by not as big a margin as Amazon did. CEO Tim Cook said it benefited from strong revenue for both its iPhone lineup and its services offerings, which include its app store.
The two Big Tech profit reports were the among most important on Wall Street Friday because Amazon, worth roughly $2.4 trillion, and Apple, at over $4 trillion, are two of the biggest companies in the market. They alone account for 10.6% of the S&P 500’s total value, even though they make up just 0.4% of its membership.
That means their stock movements can carry more weight on the S&P 500 index, which sits at the heart of many 401(k) accounts, than hundreds of other stocks.
Elsewhere on Wall Street, online message board Reddit jumped 14.7% to erase losses from earlier in the week after reporting stronger profit and revenue for the latest quarter than analysts expected.
Coinbase Global rose 3.2% after the crypto exchange’s profit likewise topped expectations.
Outside of earnings reports, Netflix added 1.9% after the video streamer announced a move that could make its stock price more affordable but still leave all its investors holding the same amount. Netflix will undergo a 10-for-1 stock split, where it will give nine additional shares to every investor with one.
They helped offset a 3.7% drop for AbbVie, even though the medicine maker reported stronger profit for the latest quarter than expected. Analysts pointed to how it’s beating forecasts by less than before, and expectations may have been high after AbbVie came into the day with a strong 28.4% gain for the year so far.
The pressure is on companies to deliver strong growth in profits to help justify the huge gains their stock prices have made since April. Criticism has been growing that the stock market has become too expensive.
Friday’s overall gains helped Wall Street recover from Thursday’s slump, when the S&P 500 fell 1%. Investors appeared unnerved by big increases in spending that Meta Platforms and Microsoft are planning as the investment spree related to artificial-intelligence technology keeps gushing. Financial markets also appeared skeptical that President Donald Trump’s trade truce with China would put an end to tensions between the two countries.
In stock markets abroad, indexes dipped in Europe following a mixed finish in Asia Friday.
Stocks fell 1.4% in Hong Kong and 0.8% in Shanghai after data showed factory activity in China contracted in October for a seventh straight month and at the fastest pace in six months.
Japan’s Nikkei 225, meanwhile, jumped 2.1% to another record index after a report showed industrial production rose 2.2% month-on-month in September, beating market expectations.
In the bond market, Treasury yields eased a bit after their spurt higher in the middle of the week, when Federal Reserve Chair Jerome Powell warned markets that another cut to interest rates in December “is not a foregone conclusion — far from it.”
The yield on the 10-year Treasury dipped to 4.08% from 4.11% late Thursday, but it’s still above the 3.99% level it was at before Powell’s warning.
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AP Business Writers Teresa Cerojano and Matt Ott contributed.
