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Dow Closes Above 35,000 for First Time as Strong Earnings Stoke Bullish Bets

Stock MarketsJul 23, 2021 04:14PM ET
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© Reuters.

By Yasin Ebrahim

Investing.com – The Dow closed above 35,000 for the first time ever, led by a rally to record highs in shares of Google and Facebook following strong quarterly results from Twitter and Snap.    

The S&P 500 rose 1.01% to a closing record of 4,411.81. The Dow Jones Industrial Average gained 0.68%, or 238 points to close at 35,061, the Nasdaq gained 1.04% to 14,836.

Facebook (NASDAQ:FB) rallied 5% and Google-parent Alphabet (NASDAQ:GOOGL) gained nearly 4% to notch record highs ahead of their quarterly results due next week. The bid up in social media companies comes as better-than-expected quarterly results from Twitter and Snap pointed to a strong backdrop for advertising spending.

Twitter (NYSE:TWTR) rallied 3% after reporting revenue growth of 74% year-over-year, its fastest growth since 2017.

“[W]e are bullish on advertising momentum heading into 2H, led by strong demand across large advertisers, evidenced by 3Q guidance being 8% above Street expectations,” Oppenheimer said as it raised its price target on Twitter to $85 from $70.

Snap (NYSE:SNAP) jumped 24% as a ramp up in users and advertising revenue led to second-quarter results that beat analyses expectations on both the top and bottom lines.

Apple Inc (NASDAQ:AAPL), Microsoft (NASDAQ:MSFT) and Amazon.com Inc (NASDAQ:AMZN) were also in the ascendency ahead of their quarterly results due next week.  

Intel (NASDAQ:INTC), however, proved a drag on the semiconductor sector after the chipmaker reported results that topped Wall Street expectations, but guidance on quarterly revenue fell short of expectations, sending its shares more than 5% lower.

“[The] bears will question the increased magnitude of the implied decline in GMs [gross margins], while also pointing to concerns around PCs, with client computing group, needing to decline through the remainder of the year to offset the forecast pickup in data center group,” Wedbush said as it lowered its target price on Intel to $50 from $53.

Financials, meanwhile, were underperforming relative to broader market as banking stocks continued to be shunned despite a rise in yields.

American Express (NYSE:AXP), up 1%, outperformed relative to broader financials, following better-than-expected quarterly revenue and earnings. 

Concerns about the outlook on the economic recovery had sent yields spiraling earlier this week, with the 10-year falling below 1.14%.

Data released Friday, showing a rise in manufacturing activity, and weaker-than-expected services activity continued to muddy the outlook.

Energy was the sole sector in the red, paced by a decline in ConocoPhillips (NYSE:COP), though downside was limited by steading oil prices.

Looking ahead, corporate earnings as well as monetary policy will take center stage next week. The Federal Reserve kicks off its two-day meeting on Tuesday. 

"The Fed will not change course quickly at next week's meeting despite the high inflation rates," Commerzbank (DE:CBKG) said. However, it is likely to push ahead with preparations and possibly present some ensuing considerations."

Dow Closes Above 35,000 for First Time as Strong Earnings Stoke Bullish Bets
 

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Comments (17)
Dave Jones
Dave Jones Jul 24, 2021 4:21PM ET
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Advertising is the cornerstone of the economy!
perplexed76 .
perplexed76 . Jul 24, 2021 12:06AM ET
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facebuk, twitter,gugle adds = economy
Chandrakant Shah
Chandrakant Shah Jul 23, 2021 7:50PM ET
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print & pump, print & pump, print & pump!!! no stopping till Dow hits 50k, S&P hits 5k and NASDAQ 25k!!!
raymond djon
raymond djon Jul 23, 2021 7:25PM ET
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Celebrating Dow hitting 35,000 while also having 5.4%+ YoY inflation, risk of national bankruptcy unless debt ceiling is raised, and a rise in unemployment is a good sign democrats are in power.
Benjamin McIntire
Benjamin McIntire Jul 23, 2021 7:25PM ET
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rofl ok you megamind
raymond djon
raymond djon Jul 23, 2021 7:09PM ET
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Congrats, stock market going up in response to hyper-inflation/CPI rise and zero interest rates and record high levels of debt. Reports have even come out showing that retail traders in the market are using historically high levels of leverage for their positions, and the average US household is now has 40% of their assets in the form of stocks. How could this possibly end badly? Definitely no bubble and totally sustainable economic model...heck, even the unexpected rise in jobless claims literally one day ago is nothing compared to the clear benefits and sustainability of hyper-inflation!
Limin Tandiono
Limin Tandiono Jul 23, 2021 7:09PM ET
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Long Live America...
Ken Prohoniak
Ken Prohoniak Jul 23, 2021 7:09PM ET
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No worries 👍 the Debt Bomb will explode sooner or later tik tick Tick TOK BOOMB 🤔
Klaus Weyers
Klaus Weyers Jul 23, 2021 6:48PM ET
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time to start shorting .. smile.. I expect a 40% correction to start any day now
Mad Money
Mad Money Jul 23, 2021 6:48PM ET
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You been saying that for the past year. Hows that worked out?
Sean Livingstone
Sean Livingstone Jul 23, 2021 6:35PM ET
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70% of the stocks are red today
Mitchel Pioneer
Mitchel Pioneer Jul 23, 2021 6:10PM ET
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Pure manipulation in the final minutes.  The biggest investment JOKE in world history.
Joel Schwartz
Joel Schwartz Jul 23, 2021 6:04PM ET
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The FED is out of control and everyone knows it. A minimum wage worker in Florida needs to work 93 hours a week to afford a 1br apartment right now. Markets need cycles or we will *literally* eat the rich.
Ric Later
riclater211 Jul 23, 2021 5:04PM ET
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Prepare for mid September through the last quarter. No more stay at home cash. Outdoor will stop spending so much. Markets are in desperate need correction
New Jazenevd
New Jazenevd Jul 23, 2021 4:48PM ET
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“Strong earnings” are irrelevant to the market rise. Money printing is relevant.
Mark Stallone
Mark Stallone Jul 23, 2021 4:40PM ET
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Whoo Hoo! Print. Print. Print. Print. What could go wrong?
Michael Angelo
Michael Angelo Jul 23, 2021 4:39PM ET
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In the next comment, will start people that has lost all the move talking about fraud or the Fed or whatever. The only thing is that the money flood combine with positive results plus the shorts are making the markets go to stratosphere.
raymond djon
raymond djon Jul 23, 2021 4:39PM ET
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Your comment does not dispute the next comments in any way, it just confirms them.
jason wilson
jason wilson Jul 23, 2021 4:35PM ET
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Also, if you are wondering the degree of the bubble we are in, for the first time in US history, the average US household has over 40% of their assets in the stock market. Retail margin holdings are at historic highs, over $800 billion, and personal debt levels are at historic highs (in addition to historic high levels of corporate and government debt). Inflation levels of the USD have never been this high with historically low interest rates, and a government that has been unable to achieve a balanced budget for over 20 years, with $30 trillion+ already in debt and threat of default in a few months of debt ceiling is not raised again. Over the past 90 years, average home price in the US has gone up 100x, and wages have only gone up 25x. The USD has seen over 100% inflation just since 1990, with the US being worth less than half of what it was in 1990. The USD has lost around 10% of its value just in the past 3 years, over 5%+ just in the past 12 months.
YouTube Account
YouTube Account Jul 23, 2021 4:32PM ET
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Price levels rise where inflation enters the market.
jason wilson
jason wilson Jul 23, 2021 4:31PM ET
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Also, if you are wondering the degree of the bubble we are in, for the first time in US history, the average US household has over 40% of their assets in the stock market. Retail margin holdings are at historic highs, over $800 billion, and personal debt levels are at historic highs (in addition to historic high levels of corporate and government debt). Inflation levels of the USD have never been this high with historically low interest rates, and a government that has been unable to achieve a balanced budget for over 20 years, with $30 trillion+ already in debt and threat of default in a few months of debt ceiling is not raised again.
jason wilson
jason wilson Jul 23, 2021 4:28PM ET
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Love how they keep comparing 2021 revenues to 2020, rather than 2019...completely drop the COVID narrative when trying to make the market sound like it is booming. They also conveniently fail to factor in the over 5% currency devaluation that has taken place over the past year. Compare 2021 revenue to 2019, then factor in 8%+ inflation over the past 2 years and the historic rise in corporate debt in this country to see the "real" growth.
 
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