S&P 500 Reaches New Highs On Netflix News
The S&P 500 (Index: SPX) popped to new highs in the third week of January 2021, before tailing off on Friday, 22 January 2021 to close 11.60 points below its new high mark of 3,853.07.
The news that caused the new record high came from Netflix (Nasdaq: NFLX). The company reported outstanding quarterly results and announced they had surpassed over 200 million subscribers. More significantly, with so many paying customers, the firm announced it will no longer need to borrow to finance its development of new programming. That change will boost the company's profitability going forward, with the news sending its stock price 10.6% higher because of the associated change in its future expectations. The company's market capitalization likewise surged to 0.8% of the entire value of the S&P 500, contributing a significant portion of the index' gains during the week.
Here is the latest update to the alternative futures chart.
(Click on image to enlarge)
We think investors are still mostly focusing on 2021-Q2 as they set current day stock prices, although it's possible they may have shifted some their focus toward a more distant time horizon in conjunction with Netflix's change in future expectations. We'll find out over the next two weeks how things settle out for the S&P 500, where the onset of new information will set the tune to which index dances.
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