Fresh Records For US Shares As Google Becomes Fourth $1 Trillion Company

The major US indices once again posted a record breaking day, with the Nasdaq Composite leading the way with a 1.1% gain as post-trade deal optimism kicked in. The positive day for markets included a major milestone, with Google parent company Alphabet becoming the fourth firm to pass the $1trn market cap level, joining Apple (AAPL), Amazon (AMZN) and Microsoft (MSFT). Alphabet (GOOGL) has come out of the blocks in 2020 and the near 7% rise has seen it join the trillion club.

The Nasdaq itself has now risen by 4.3% in 2020 so far. Of the 100 largest Nasdaq firms, media giant Fox (FOX), orthodontics company Align Technology (ALGN) and hard drive firm Western Digital (WDC) led the way on Thursday with 4.4%, 4% and 3% share price gains respectively. The S&P 500 and Dow Jones Industrial Average also had big days, gaining 0.8% and 2.7%. Leading the 30 stocks in the Dow was telecoms giant Cisco (CSCO), with a 2.2% share price gain.

S&P 500: +0.8% Thursday, +2.7% YTD

Dow Jones Industrial Average: +0.9% Thursday, +2.7% YTD

Nasdaq Composite: +1.1% Thursday, +4.3% YTD

British Airways flying after lifting restrictions on investors

British Airways’ parent company, International Consolidated Airlines (ICAGY), has lifted an almost year long restriction on non-EU investors purchasing the stock, in turn this has seen shares rally by more than 5% this morning. The concern was over the percentage of non-EU ownership, which has now dropped to such a level that management have decided to lift the cap. The company also owns Iberia, Vueling and Aer Lingus. Shares had a mixed 2019, losing over 30% of their value from highs, only to stage a remarkable recovery going into Q4, paring all its losses and closing the year positively. The price is currently 8% shy of the record high reached in June 2018.

Banks top and tail the S&P 500 on mixed results

In US stocks, the S&P 500 was topped and tailed by two large banks after their Q4 earnings reports. Morgan Stanley led the S&P 500 with a 6.6% share price pop that was driven by a substantial earnings beat, with profits of $1.30 a share more than 30% above analyst estimates. Q4 profit was up 46%, and the firm’s investment management division almost doubled its revenue year-over-year. At the bottom of the S&P 500 was BNY Mellon, whose share price sank by 7.8% after the bank reported disappointing expense growth and a hit from lower interest rates. Banks have delivered mixed results this week, with billion dollar plus legal bills hurting Goldman Sachs and Wells Fargo, middling figures from Bank of America and blockbuster results for JPMorgan Chase and Morgan Stanley. The US financial sector posted a solid 2019, with the iShares Dow Jones US Financial ETF delivering a 31% return.

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