Shares of Amazon surged 15.3 percent as the tech giant posted more than 62 billion US dollars in quarterly profits and a 20 percent revenue increase that was far higher than analysts had expected.
Amazon’s surge eased investor worries about artificial intelligence investments amid questions about the payoff, a day after Microsoft also impressed investors with strong results.
The Dow Jones industrial average closed 0.5 percent higher at 52,485.03. The S&P 500 gained 0.7 percent to finish at 7,489.72 and the Nasdaq Composite ended up 1.0 percent at 25,373.85.
“The earnings picture continues to surprise very much to the upside, especially with Amazon’s results, and so I think investors are ignoring the prospect of higher interest rates down the road,” said CFRA Research’s Sam Stovall.
The gains in the indices came despite a 7.4-percent fall in Apple due to disappointment over the company’s outlook.
Markets continued to keep an eye on US Treasury yields, which remained elevated amid concerns that persistent inflation will compel the Federal Reserve to lift interest rates.
Investors have been monitoring the bond market since a divided Fed kept interest rates unchanged on Wednesday.
The three dissenting policy makers from Wednesday’s Fed meeting said on Friday that rate hikes were needed immediately to avoid entrenched inflation.
“Inflation has been too high for too long,” said Cleveland Fed president Beth Hammack. “The longer that high inflation persists, the more challenging and costly it can be to bring it back down.”
Analysts have noted that heavy selling in recent weeks was focused on concerns about when the huge sums invested in artificial intelligence would see returns, rather than fundamental problems in the sector. (AFP)
