Apple, Amazon, MS, and the Fourth
Reflecting US IT Stock Boom... Nasdaq Surpasses 9300
[Asia Economy New York=Correspondent Baek Jong-min] Alphabet, the parent company of 'search king' Google, has joined the $1 trillion market capitalization club. It is the fourth case following Apple, Amazon, and Microsoft (MS). The three major New York stock exchanges, including Nasdaq, again recorded all-time highs.
On the 16th (local time), Alphabet closed at $1,451.70, up $12.50 (0.87%) from the previous day in the New York stock market. The market capitalization recorded that day was $1.01 trillion.
Alphabet's market cap surpassing $1 trillion fully reflects the boom in the US IT sector. CNBC analyzed that despite regulatory pressure, investors highly valued the growth potential of cloud businesses and others. With the result of the US-China Phase One trade agreement, China promised not to pressure US companies for technology transfer, leading to evaluations that major US tech companies dominating the market will benefit.
As the rise of IT companies like Alphabet stands out, the US stock market again hit record highs. The Nasdaq index, centered on tech companies, surpassed the 9,000 mark at the end of last year and closed at 9,357.13, up 98.44 points (1.06%) that day, exceeding 9,300. The Dow Jones Industrial Average and the S&P 500 also closed at 29,297.64 and 3,316.81, up 267.42 points (0.92%) and 27.52 points (0.84%), respectively.
The strength of the financial sector cannot be overlooked. Major US banks such as JP Morgan, which announced earnings this week, mostly recorded 'earnings surprises' and led the market. Morgan Stanley, which announced earnings that day, posted a 46% surge in net profit for Q4 last year compared to the same period the previous year, reaching $2.24 billion. Its stock price soared 6.61%.
Bloomberg News evaluated that bank stocks are the representative beneficiaries of President Donald Trump's tax cut policy. The news reported that the net profits of the six major US banks last year reached $120 billion, noting that before the tax rate cut, US banks' net profits had never exceeded $100 billion. It is understood that the effective tax rate of these banks last year dropped from the previous 20% to 18%. This means that profits increased as taxes decreased.
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