The S&P 500 and Nasdaq Composite reached record highs on Wednesday, fueled by gains in tech stocks following strong performances from Salesforce and Marvell Technology. Tech shares drove the rally, boosting investor sentiment and lifting broader market indices to impressive new levels.
Tech Stocks Lead the Market Rally
The broad S&P 500 index climbed 0.6%, while the Nasdaq Composite, which is more tech-focused, rose by 1.2%. Meanwhile, the Dow Jones Industrial Average also posted gains, advancing 328 points, or 0.7%.
Leading the charge was Salesforce, which surged 9% after exceeding fiscal third-quarter revenue estimates. Chipmaker Marvell Technology also outperformed, rising by 24% on the back of strong earnings and fourth-quarter guidance, marking its best daily performance since May 2023. These gains powered the Technology Select Sector SPDR Fund (XLK) to an all-time high, rising 1.5%.
Analysts Weigh in on Tech Performance
Despite previous claims that the tech sector’s dominance was fading, experts now suggest the rally is far from over. Nancy Tengler, CEO of Laffer Tengler Investments, told CNBC, “People have come out and said, the tech trade’s over. If you look at sector performance, the stocks have lagged since July—but that doesn’t mean that they can’t reaccelerate.” Tengler emphasized that while the market broadens, technology could still outperform.
Investors Eye Labor Market Data
The market moves came ahead of upcoming U.S. employment data, expected to provide further insight into the economy’s strength. Economists surveyed by Dow Jones forecast an increase of 214,000 jobs in November.
In contrast, ADP’s report on Wednesday showed that private payrolls grew less than expected, with companies adding 146,000 positions, compared to the anticipated 163,000. This discrepancy could be crucial in shaping investor expectations for future Federal Reserve actions.
Federal Reserve Takes a Cautious Approach
Fed Chair Jerome Powell addressed the strength of the U.S. economy in a moderated discussion in New York, suggesting the central bank could proceed cautiously on rate cuts. “The labor market is better, and the downside risks appear to be less in the labor market. Growth is definitely stronger than we thought, and inflation is coming at a little higher,” Powell said. He added that this resilience affords the Fed more caution as it seeks to achieve a neutral policy stance.
