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S&P 500 Rallies as Tech, Retailers Flex Muscles

Stock Markets May 26, 2022 03:33PM ET
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© Reuters

By Yasin Ebrahim

Investing.com -- The S&P 500 climbed Thursday, as stronger-than-expected quarterly results from retailers and a rally in tech put stocks on course to snap a seven-week losing streak.

The S&P 500 rose 2%, the Dow Jones Industrial Average gained 1.7%, or 544 points, and the Nasdaq was up 2.6%.

Retailers – victim to a wave of selling pressure recently – were back in vogue as strong results from Macy’s and Dollar Tree eased worries about the strength of the consumer.

Macy’s (NYSE:M) raised its outlook on profit after reporting a better-than-expected first-quarter, supported by price hikes amid strong demand. Its shares rose more than 18%.

Dollar Tree (NASDAQ:DLTR) surged more than 21% after reporting quarterly results that beat on both the top and bottom lines as the discount retailer’s recent move to raise prices to $1.25 boosted margin and growth.

Reopening stocks including Norwegian Cruise Line (NYSE:NCLH) and Caesars Entertainment (NASDAQ:CZR) also played a role in pushing the broader market higher as investors bet on a strong travel demand for the summer months ahead.

Tech, meanwhile, racked up gains, with big tech in ascendency as expectations for a Fed pause on rate hikes later this year was boosted by data showing an unexpected decline in first-quarter economic growth.

Facebook (NASDAQ:FB) led the gains up more than 4% followed by Apple (NASDAQ:AAPL), Alphabet (NASDAQ:GOOGL) and Microsoft (NASDAQ:MSFT).

Chip stocks were also supporting the bid in tech, driven by a rally in Nvidia and Broadcom.

NVIDIA (NASDAQ:NVDA) reported better-than-expected first quarter results but guidance fell short of analysts’ estimates.

Some analysts, however, aren’t convinced that it’s time to dip into the chipmaker amid concerns about valuation.

“NVDA is arguably attractively valued at current levels. But, until there is more evidence that indeed this quarter marks a trough for gaming revenues, we believe investors will continue to struggle with NVDA's valuation,” Wedbush said.

Broadcom (NASDAQ:AVGO) was up more than 2% after announcing that it would acquire VMware (NYSE:VMW) in a $61 billion deal. 

Twitter (NYSE:TWTR), meanwhile, gained more than 5% on fresh hopes that Tesla chief executive Elon Musk will proceed with his deal to take the social media company private after the Tesla (NASDAQ:TSLA) CEO increased his commitment in the deal to $33.35 billion.

S&P 500 Rallies as Tech, Retailers Flex Muscles
 

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Comments (6)
Ac Tektrader
Ac Tektrader May 26, 2022 4:09PM ET
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this rally maybe the last time to exit the market before the s&p500 takes another leg down...I'm looking at June 3 as a possible turning point in the equities and a continuation of the downturn.
Matt Kay
Matt Kay May 26, 2022 4:01PM ET
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weak, withered muscles
Tom Scurlock
Tom Scurlock May 26, 2022 3:51PM ET
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That’s it… climb climb climb today…. To drop 1,200 tomorrow!!!!You heard it first here!!!!
Jared Magnums
Jared Magnums May 26, 2022 3:51PM ET
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Thanks for the insight Nostradamus.If only you could use this same “wisdom” to make money in the market…
Casador Del Oso
Casador Del Oso May 26, 2022 3:49PM ET
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funny. retail and tech recently caused huge drops in the market.
SURENDER KUMAR
SURENDER KUMAR May 26, 2022 3:09PM ET
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this is not market only income source
Sudeep Antony
Sudeep Antony May 26, 2022 2:19PM ET
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let this momentum continue
 
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