Big U.S. corporations, including Apple, reporting better-than-anticipated profits helped Wall Street recover from earlier losses observed at the beginning of the week on Friday.
The S&P 500 index recorded a 0.4% increase in early trading, positioning it for only a 0.1% loss for the week after substantial declines on Monday. There were concerns that the booming artificial-intelligence sector, which had previously driven stock prices to record highs, might not necessitate as much investment as initially believed. At 9:35 a.m. Eastern time, the Dow Jones Industrial Average was up by 87 points or 0.2%, while the Nasdaq composite saw a rise of 0.9%.
Apple played a significant role in the market rebound, showing a 3.2% surge in its stock following the announcement of higher-than-expected profits for its latest financial quarter. Although sales of its iPhones saw a slight decrease, revenue from its services, which include AppleCare and the app store, reached a record high. Being the most valuable company on Wall Street, Apple’s performance greatly influences other indexes, including the S&P 500.
KLA, a provider for the electronics industry, experienced a 1.8% rise after surpassing profit and revenue estimates according to analysts. The company attributed its success to growing investments in artificial intelligence and high-performance computing, recovering some of the losses it faced on Monday when global tech stocks were hit hard. This decline came in the wake of a Chinese company, DeepSeek, announcing the development of a competitive large language model that doesn’t rely on high-end chips.
The news from DeepSeek sparked concerns regarding the necessity for substantial investments in AI chips, data centers, and electricity. Additionally, U.S. stocks received a boost on Friday from a relatively stable bond market, which had seen rising Treasury yields adding pressure in recent months.
Treasury yields remained mostly steady following an inflation update that aligned closely with economists’ expectations. The yield on the 10-year Treasury decreased slightly to 4.51% from 4.52% late Thursday. Since September, yields have generally been on the rise due to stronger-than-anticipated performance in the U.S. economy. Recently, concerns about potential tariffs and other policies from the Trump administration contributing to increased inflationary pressure and rising U.S. government debt have also caused yields to increase.
Trump has indicated that he may implement tariffs of 25% on imports from Canada and Mexico starting as early as Saturday.
On Wall Street, Walgreens Boots Alliance saw a drastic decline of 14.1% after it announced the suspension of its dividend, ending a dividend distribution streak that had lasted over 90 years. Meanwhile, Exxon Mobil’s stock dipped by 1.2%, despite reporting a fourth-quarter profit that exceeded Wall Street’s forecasts, as its revenue fell short of expectations. Exxon attributed its strong results to increased production in the U.S. Permian Basin and Guyana.
In the international markets, European indexes saw slight gains after a mixed performance in Asia. Japan’s Nikkei 225 index rose by 0.1% in response to news that the country’s core inflation rate exceeded the central bank’s 2% target, setting the stage for future interest rate hikes. In South Korea, the Kospi index fell by 0.8% as trading resumed following the holiday, while markets in Hong Kong and Shanghai remained closed for Lunar New Year celebrations.
