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S&P 500 notches closing record with focus on Trump comments, earnings
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S&P 500 notches closing record with focus on Trump comments, earnings
Jan 23, 2025 4:31 PM

By Sinéad Carew and Johann M Cherian

(Reuters) -The benchmark S&P 500 rose to a record closing high on Thursday, as investors assessed a mixed bag of corporate earnings and digested comments from President Donald Trump, including a call for cuts in interest rates and oil prices.

At the World Economic Forum in Davos, Switzerland, Trump demanded that OPEC lower oil prices and that central banks reduce interest rates, while he warned global business leaders they will face tariffs for products made outside of the U.S.

While investors have been cautiously monitoring Trump's comments about tariffs, they "like the idea of interest rates coming down, of oil prices coming down," said Lindsey Bell, chief strategist at 248 Ventures.

"All in all, the market is optimistic the more they hear about Trump policies. We're just seeing a reflection of that optimism," said Bell.

However, investors have been concerned that tariffs could add to inflation pressures and slow the pace of interest rate cuts by the U.S. Federal Reserve.

The Fed is expected to leave interest rates unchanged next week at its first policy meeting of the year.

Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia, said the Fed is expected to base rate decisions on economic data rather than presidential demands.

"I don't think the Fed is going to pay much attention to this," said Tuz, referring to Trump's comments on rates. "They're looking at the data and they're going to make their decision based on what they see."

Tuz saw Thursday's moves as a mix of reactions to earnings reports and new Trump administration policies.

All three of Wall Street's major indexes scored their fourth straight day of gains.

The S&P 500 gained 32.34 points, or 0.53%, to 6,118.71, The S&P 500 registered its first closing record since Dec. 6 after narrowly missing the milestone on Wednesday.

The Dow Jones Industrial Average rose 408.34 points, or 0.92%, to 44,565.07 and the Nasdaq Composite gained 44.34 points, or 0.22%, to 20,053.68.

All 11 S&P 500 sectors ended with gains, after mixed trading earlier.

The biggest advance was from healthcare, up about 1.35%, followed by industrials, up 0.96%.

The S&P 500 banks index ended up 0.73% after touching a record high earlier in the day.

The utilities sector pared earlier gains to end up 0.47%. Power utilities outperformed after Trump told the World Economic Forum that the United States needs double the energy it has to power rapidly emerging AI operations.

Constellation Energy added 4.1% and AES Corp rose 3.6% while Vistra Corp rose 2.7%.

Technology was the smallest gainer, adding just 0.12% after rallying 2.5% on Wednesday following Trump's announcement of a private-sector $500-billion investment in AI infrastructure.

On the economic data front, a Labor Department report showed weekly jobless claims stood at 223,000, compared with expectations of 220,000.

In earnings, GE Aerospace stock finished up 6.6% after it forecast 2025 profit above estimates and shares in health insurer Elevance rose 2.7% after beating estimates for fourth-quarter profit.

However, Electronic Arts shares sank 16.7% after the video game publisher cut its forecast for annual bookings. American Airlines shares dropped 8.7% after it forecast 2025 profit below expectations.

On U.S. exchanges, 13.54 billion shares changed hands, below the 14.83-billion average for the last 20 sessions.

Advancing issues outnumbered decliners by a 1.45-to-1 ratio on the NYSE where there were 255 new highs and 52 new lows.

On the Nasdaq, 2,584 stocks rose and 1,807 fell as advancing issues outnumbered decliners by a 1.43-to-1 ratio. The S&P 500 posted 32 new 52-week highs and six new lows while the Nasdaq Composite recorded 77 new highs and 116 new lows.

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