On Tuesday, the U.S. stock market extended its rally, buoyed by a wave of upbeat earnings reports that drove all major indexes higher. The Dow Jones Industrial Average surged by 250 points, marking a robust 0.7 percent gain, while the broader S&P 500 index saw a more than 1 percent increase, and the tech-heavy Nasdaq composite index soared by 1.6 percent.
One of the standout performers driving the market’s bullish sentiment was Spotify, the renowned audio streaming service. Despite being headquartered in Sweden, Spotify is publicly listed on the New York Stock Exchange. Following the company’s quarterly earnings release, Spotify’s shares surged by an impressive 14 percent. The company reported a quarterly profit of 197 million euros, although it slightly missed its guidance with 615 million monthly active users (MAUs). Nonetheless, Spotify showcased robust growth, with a 19 percent increase in MAUs and a 14 percent rise in premium subscribers, which represent a significant revenue stream for the company.
Aside from Spotify, several other major corporations, including Pepsi, UPS, and GE Aerospace, exceeded earnings expectations, further fueling the positive sentiment in the equities market. Investors eagerly anticipated upcoming earnings reports from tech giants such as Meta, Alphabet, and Microsoft later in the week, anticipating their potential impact on market dynamics.
Following the market’s closing bell, Tesla, the electric vehicle manufacturer, reported its largest revenue decline since 2012, triggering concerns among investors. However, Tesla’s shares rallied significantly in after-hours trading after the company announced plans to reintroduce a more affordable entry-level model. Analysts are keen to glean insights from CEO Elon Musk during the earnings call, particularly regarding Tesla’s future trajectory amidst challenges such as sluggish global demand for electric vehicles and margin pressures.
Meanwhile, former President Donald Trump was on the cusp of a substantial boost to his net worth, albeit on paper. Trump Media & Technology Group, the parent company of Truth Social, closed trading with its stock priced at $32.50, rendering Trump eligible for a bonus of 36 million shares valued at $1.2 billion. This bonus, referred to as an “earnout,” was contingent upon the stock trading above a specified threshold for a predetermined period.
Overall, the stock market’s positive performance underscored investor confidence and optimism, despite lingering concerns about certain sectors and economic headwinds.