ASX set to rise after Wall Street rally

“It’s important when you hear Federal Reserve members endorsing that,” said Quincy Krosby, chief equity strategist for LPL Financial.

Gains for tech-oriented stocks accounted for a big share of the S&P 500’s rally Friday. Google’s parent company said it was cutting costs by laying off 12,000 workers, and Netflix reported a surge in its number of subscribers.

Netflix’s surprising report late Thursday helped set the stage for Friday’s rally, because the market had feared the streaming service’s latest results would be disappointing and fuel worries about weaker earnings overall, said Jay Hatfield, CEO of Infrastructure Capital Advisors.

“When they started rocketing, then all the Nasdaq started moving, and that moves the S&P and everything else follows,” Hatfield said.

Alphabet rose 5.3 per cent after becoming the latest Big Tech company to acknowledge it expanded too quickly in recent years amid a boom created by the pandemic. Netflix jumped 8.5 per cent.

Cruise lines also notched gains. Carnival rose 3.5 per cent, Norwegian Cruise Lines climbed 4.5 per cent and Royal Caribbean added 3.6 per cent.

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Also influencing the market on Friday: the expiration of $US797 billion ($1.14 trillion) in stock-option contracts. That’s the largest amount for single stock options since January 2022 and the fourth-largest on record, according to Goldman Sachs.

Treasury yields mostly rose, clawing backdrops from earlier in the week driven by worries about a weakening economy. The yield on the 10-year Treasury, which helps set rates for mortgages and other important loans, rose to 3.48 per cent from 3.40 per cent late Thursday.

The two-year yield, which tends to more closely track expectations for Fed action, rose to 4.19 per cent from 4.13 per cent.

All told, the S&P 500 rose 73.76 points to 3,972.61. The Dow gained 330.93 points to 33,375.49. The Nasdaq added 288.17 points to close at 11,140.43.

Small company stocks also notched solid gains. The Russell 2000 index rose 30.99 points, or 1.7 per cent, to finish at 1,867.34.

Stock markets overseas mostly made modest gains.

The Nikkei 225 added 0.6 per cent after Japan reported that its consumer inflation rate hit 4 per cent in December, its highest level in 41 years. The high reading may add to pressures on the Bank of Japan to alter its longstanding policy of keeping its key interest rate at an ultra-low level of minus 0.1 per cent. But economists expect price pressures to ease in coming months as inflation elsewhere declines.

AP