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US tech stocks lead Wall Street rally

Published : Sunday, 21 January, 2024 at 12:00 AM  Count : 89

NEW YORK, Jan 20: Wall Street stocks rallied Friday, with the tech sector logging major gains while the Dow and broad-based S&P 500 hit new highs.

But European markets, which are much less tech-heavy than their American counterparts, lagged as they ended the week lower on concerns about slow growth and high interest rates.

Global equities had rebounded Thursday as tech giants clawed back recent losses, overcoming concerns about central banks delaying rate cuts.

Those gains continued into Friday, though at a less hectic pace.

Still, it was enough for the S&P 500 to surpass its last record close in early 2022.

"The tech stocks are continuing to lead the market higher," said Adam Sarhan of 50 Park Investments.

"You have explosive action in SMCI, in Nvidia, in Broadcom, in semiconductors in general, and that remains bullish for the market," he said.

SMCI shares rocketed 35.9 percent, Nvidia climbed 4.2 percent and Broadcom added 5.9 percent.

"The tech sector and communication services are still driving the US market, and Europe is missing out because of its lack of tech exposure," said XTB research director Kathleen Brooks.

New Yorks gains were largely driven by a surge in tech giants including Alphabet, Meta and Nvidia after chip titan Taiwan Semiconductor Manufacturing Co unveiled a strong outlook for capital spending and revenue that boosted hopes for 2024.

They also came as Meta CEO Mark Zuckerberg posted on Instagram that the company is purchasing AI products including Nvidia chips which are key to AI projects

European markets rose initially on the back of the Wall Street rally before turning lower over continued concerns that central banks will delay interest rate cuts and as investors continued to digest news of Germanys shrinking economic output.  

European markets "struggled to build on the gains of yesterday," said Michael Hewson, chief market analyst at CMC Markets UK.    —AFP

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