[New York Stock Market] Rise Amid Big Tech Earnings Expectations... Nasdaq Up 1.11%

Earnings Season Kicks Off with Tesla on the 23rd
Q1 GDP and March PCE Inflation Data to Be Released This Week

The three major indices of the U.S. New York stock market closed higher on the 21st (local time). With the earnings announcements of the 'Magnificent 7' (Nvidia, Amazon, Meta, Alphabet, Microsoft (MS), Apple, Tesla) companies scheduled for this week, technology stocks surged, leading the rebound. International oil prices fell amid easing tensions in the Middle East.

On the day at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average, centered on blue-chip stocks, closed at 38,239.98, up 253.58 points (0.67%) from the previous trading day. The S&P 500, focused on large-cap stocks, rose 43.37 points (0.87%) to close at 5,010.60, surpassing the 5,000 mark. The tech-heavy Nasdaq index jumped 169.29 points (1.11%) to close at 15,451.31.

By stock, Nvidia, the leader in artificial intelligence (AI), rose 4.35%. British semiconductor company ARM surged 6.79%. Apple, which Bank of America (BoA) named as this year's top pick, rose 0.51%. Tesla, which lowered electric vehicle prices in the U.S. and China, fell 3.4%. Chinese electric vehicle maker Li Auto also responded with price cuts and expanded subsidies, showing a 5.57% decline.

Following Federal Reserve (Fed) Chair Jerome Powell's indication of delayed interest rate cuts and geopolitical concerns due to Iran's attack on Israeli territory, the market, which fell last week, is shifting to an earnings-driven phase this week. More than 180 companies, accounting for over 40% of the S&P 500's market capitalization, will release quarterly earnings this week. Market attention is focused on big tech earnings announcements. Starting with Tesla on the 23rd, Meta will report on the 24th, followed by MS and Alphabet on the 25th. Next week, Apple and Amazon will announce earnings, and Nvidia's earnings are scheduled for the 22nd of next month. According to Bloomberg Intelligence (BI), the Magnificent 7's first-quarter earnings are expected to grow 37.5% year-over-year, significantly outperforming the 2.4% earnings growth forecast for all S&P 500 companies.

Chris Fasiano, portfolio manager at Commonwealth Financial Network, said, "This earnings report is likely to determine whether the sell-off in tech stocks ends or continues," adding, "Investors will probably attempt to differentiate stock prices based on growth prospects for some of the promising growth companies that have led the market in recent years."

Experts believe that not only quarterly earnings but also future earnings outlooks will influence market trends.

Matt Mielke, chief market strategist at asset management firm Miller Tabak, said, "Earnings are now moving to the forefront," and analyzed, "For the stock market to rebound significantly, earnings forecasts must improve enough to raise consensus for this year and next, rather than just how many companies beat expectations."

This week, the preliminary GDP growth rate for the first quarter and the March personal consumption expenditures (PCE) price index will be released. The first-quarter GDP, to be announced on the 25th, is expected to grow 2.5% compared to the previous quarter. The core PCE price index, released on the 26th, is expected to rise 2.6% year-over-year, a smaller increase compared to February's 2.8%. With the consumer price index (CPI) exceeding market expectations for three consecutive months this year, the market's attention is increasingly focused on the PCE price index, the Fed's most closely watched indicator, which will help gauge the future path of interest rates.

Mark Hacket, head of investment and research at Nationwide, said, "Geopolitical and political uncertainties have joined inflation, interest rates, and the Fed in putting pressure on the market," and predicted, "This week will be an important period of tug-of-war between bulls and bears as earnings and the PCE price index are released."

Government bond yields remained steady. The U.S. 10-year Treasury yield, a global bond yield benchmark, stood at 4.619%, and the 2-year Treasury yield, sensitive to monetary policy, remained at 4.971%, unchanged from the previous trading day.

International oil prices fell after Iran stated it would not escalate conflicts with Israel. West Texas Intermediate (WTI) crude oil closed at $82.85 per barrel, down $0.29 from the previous day, while Brent crude, the global oil price benchmark, fell $0.29 to close at $87 per barrel.