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22 Oct 2021
2.5 min read

S&P500 Notches a Fresh Record as Earnings Optimism Soars

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Key Takeaways

  • S&P500 makes a new all-time high driven by Tesla, Netflix and Microsoft
  • Bitcoin’s price retreats after a spectacular run to a record on Wednesday

What’s on Focus in the Markets?

Solid earnings growth reported by some of the largest US companies drove the S&P500 to a new all-time high Thursday. After over a month of lacklustre performance, the broad-based index was able to erase previous losses this week. Moreover, the fresh record was powered by solid gains for Tesla, Netflix and Microsoft.

In more detail, the blue-chip S&P500 index closed up 0.3% to settle at a record of 4,549.78. The new peak arrived about seven weeks after the previous all-time high. Between then and now, however, a flurry of events has defined the stock market.

From the US Federal Reserve tapering announcement to soaring earnings reports for the third quarter. On the latter, investors appear optimistic to jump back into risky assets amid the solid growth indicated in the earnings season.

That said, behind the S&P500 rally were big tech names such as Tesla. The electric car maker rose to a record high of $900 a share a day after it beat earnings estimates. Furthermore, Microsoft’s 1% gain and a 4.5% jump in Netflix shares added more fuel to the upside.

What’s the Latest News on Bitcoin?

In the meantime, the price of bitcoin retreated from its record set Wednesday. Still, the leading cryptocurrency is on pace to close its fourth straight week in the green. On that note, bitcoin has gained over 6% since Monday and is currently changing hands above $63,000 per coin.

In signs of a crypto market expansion, a second US-listed Bitcoin futures ETF is coming to the traditional markets today. On Friday, the Valkyrie Bitcoin Fund begins trading on the Nasdaq stock exchange. Similarly to the first-to-market Bitcoin ETF, the ProShares Bitcoin Strategy ETF, the second one will also hold bitcoin futures.

Against that backdrop, trading cryptocurrencies in the broader market has now spilled over to include Wall Street. In other words, new crypto enthusiasts, including institutional investors, are expected to enter the fast-developing digital asset market.

Elsewhere in the Financial Markets

In other parts of the global financial markets, the USD/JPY reversed its upside swing on Wednesday. The pair peaked at a multi-year high of 114.70 and shortly after shifted gears to lower levels. Currently, the USD/JPY exchange rate is trading below 114.00.

The price of gold, meanwhile, hovers above $1,790 per troy ounce on Friday. The precious metal has been in a steady upside trend over the past four days.

What’s Next for Traders and Investors?

Market participants are bracing for increased stock market volatility next week. More precisely, the continuation of the earnings season accelerates with Big Tech reporting. Among the companies scheduled to present quarterly figures are Apple, Microsoft, Google parent Alphabet, Facebook and Amazon.

Today’s Economic Calendar (EST times)

  • 04:00 am, UK, PMI reports (Oct)
  • 08:30 am, CAD, Core Retail Sales (MoM) (Aug)
  • 11:00 am, US, Fed Chair Powell Speaks

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