By Yasin Ebrahim
Investing.com -- The S&P 500 climbed as chip stocks helped tech bounce back from a wobble a day earlier to keep the broader market on track for its fourth straight weekly gain.
The S&P 500 gained 1.1%, the Dow Jones Industrial Average added 0.9%, or 49 points, the Nasdaq was up 1.48%.
Technology stocks were led higher by a more than 2% jump in semiconductor stocks as dip-buying in Micron Technology Inc (NASDAQ:MU) and NVIDIA Corporation (NASDAQ:NVDA) continued after the duo plunged earlier this week on profit warnings.
As well as rallying chip stocks, big tech was also in the ascendency. Apple (NASDAQ:AAPL) was up more than 1% after the tech giant reportedly told iPhone suppliers to ramp up production amid expectations for sales to remain steady despite a slowing market.
Tech is set to gain nearly 2% this week on easing fears of a deep recession and signs of easing inflation that has pressured U.S. Treasury yields.
“Treasury yields have come down, allowing the sector to be valued higher than it was before … [boosting] the mega cap tech stocks that dominate the equity indexes,” Jimmy Lee, the founder and CEO of The Wealth Consulting Group, told Investing.com in an interview on Thursday. "The idea that we're not going to be in a bad recession, and a recession could be short lived," Lee added, has also played a role in the recent run-up in big tech.
Sentiment on stocks were also boosted by data pointing to an ongoing recovery in the consumer sentiment on the economy, but expectations on five-year inflation ticked up to 3%.
While this is “not good news for the Fed,” Jefferies said in a report, the decision of whether the central bank hikes rates by 50 basis points to 75 points in September “is going to depend on the August employment data and CPI that are released closer to the meeting next month.”
Energy, meanwhile lagged the market’s move higher as oil prices slipped 2% on waning fears about demand even as OPEC, in contrast to the International Energy Agency’s report earlier this week, cut its outlook on oil demand amid global growth worries.
The earnings front served up mixed quarterly results as Toast jumped, while Illumina slumped.
Toast (NYSE:TOST) lifted its full-year earnings guidance after reporting a narrower-than-expected quarterly loss, driven by increasing demand for its restaurant payment technology. Its shares were up more than 13%.
Illumina (NASDAQ:ILMN), however, fell nearly 14% after delivering gloomy guidance that fell short of Wall Street estimates following second-quarter results that missed on both the top and bottom lines.
Rivian Automotive (NASDAQ:RIVN) was flat after forecasting a deeper annual loss, though investors appeared to take solace from production guidance that remained unchanged despite supply-chain issues.
In other news, Peloton Interactive (NASDAQ:PTON) jumped more than 5% as the exercise equipment maker reportedly readies more job cuts and aims for price hikes to strengthen its balance sheet.