US STOCKS-S&P 500 hits record high on Netflix results, AI investment plans

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22/01/2025 19:57

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      Oracle up after Trump unveils private-sector $500 bln AI
plan
    

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      Procter & Gamble gains after upbeat Q2 results
    

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      Indexes up: Dow 0.25%, S&P 500 0.68%, Nasdaq 1.28%
    

  
 (Updates prices to late afternoon)
    By Sinéad Carew and Johann M Cherian
       Jan 22 (Reuters) - Wall Street's main indexes rose on
Wednesday, with the benchmark S&P 500 hitting a record high, as
investors cheered streaming video provider Netflix's quarterly
report and technology shares rallied after the announcement of a
private-sector artificial intelligence infrastructure plan.
    Risk appetites got a boost from data pointing to a strong
economy with cooling inflation and U.S. President Donald Trump's
more moderate than feared approach to tariffs so far.
    Netflix  NFLX.O  was the S&P 500's biggest percentage gainer
with a 9.8% advance after the company reported a record number
of subscribers for the holiday quarter, enabling it to increase
prices for most service plans.
    The technology sector  .SPLRCT  was the biggest gainer while
Nvidia  NVDA.O  was the biggest boost for the S&P 500 and the
Nasdaq followed by Microsoft  MSFT.O .
        Investors were piling bets into the promise of AI
Tuesday's announcement by Trump of a 
    $500 billion private-sector AI infrastructure plan from
Oracle  ORCL.N , OpenAI and SoftBank  9984.T , even though there
was no clarity on funding.
    "It's a story of big tech and everything else is hanging in
there," said Matt Stucky, chief portfolio manager for equities
at Northwestern Mutual Wealth Management, who attributed much of
Wednesday's rally, particularly in chip stocks, to the AI
announcement.  
        "The direct beneficiary, at least the beginning would be
the semiconductor space," he said pointing to the Philadelphia
semiconductor index  .SOX  outperformance with a 2.3% gain.  
  
        But without funding clarity, Stucky described the news
as "more of a pie in the sky kind of investment story." 
  
        Nevertheless, Oracle shares were up 7.6% while server
makers Dell  DELL.N  and Super Micro  SMCI.O  added more than
4%. Microsoft  MSFT.O  added 3.9% and Nvidia rose 4.8%. U.S.
traded shares of ARM Holdings  ARM.O , a technology supplier to
chip companies that is 90% owned by SoftBank, were up 14.8%. 
  
        Investors were still waiting cautiously for Trump's
trade plans due to inflation concerns after he warned that
tariffs on imports from China, Mexico, Canada and the European
Union could be issued on Feb. 1. 
    The president has ordered federal agencies to complete
comprehensive reviews of a range of trade issues by April 1 -
the date that analysts at Barclays say markets should focus on.
        The Dow Jones Industrial Average  .DJI  rose 111.36
points, or 0.25%, to 44,136.46, the S&P 500  .SPX  gained 40.88
points, or 0.68%, to 6,090.12 and the Nasdaq Composite  .IXIC 
gained 252.60 points, or 1.28%, to 20,009.69.
  
        Just two of the 11 S&P 500 sectors rose, with technology
rising 2.6% communications services  .SPLRCL  up 1.3% with
Netflix leading the charge followed by Meta Platforms  META.O . 
    In individual stocks Procter & Gamble  PG.N  advanced 2.2%
after beating second-quarter estimates, driven by growing demand
for its household items in the United States.
    Johnson & Johnson  JNJ.N  fell 2.5% although the drugmaker
reported fourth-quarter results above estimates.
    After rising on Tuesday, Ford  F.N  lost 3.3% as Barclays
downgraded the stock. Textron  TXT.N  fell 4% after it forecast
2025 profit below estimates.
    Halliburton  HAL.N  slipped 2.6% after warning of softer
activity in North America this year and posting downbeat
quarterly revenue.
    Declining issues outnumbered advancers by a 1.43-to-1 ratio
on the NYSE where there were 242 new highs and 46 new lows.
        On the Nasdaq, 1,896 stocks rose and 2,456 fell as
declining issues outnumbered advancers by a 1.3-to-1 ratio. 
  
        The S&P 500 posted 38 new 52-week highs and 4 new lows
while the Nasdaq Composite recorded 98 new highs and 79 new
lows.
  

 (Reporting by Sinéad Carew in New York, Johann M Cherian, Purvi
Agarwal and Sukriti Gupta in Bengaluru; Editing by Arun Koyyur,
Maju Samuel and David Gregorio)
 ((sinead.carew@thomsonreuters.com; +13322191897;
johann.mcherian@thomsonreuters.com;))