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Market Snapshot: Stocks rise to new intraday record highs Friday

Stocks rose Friday, with the S&P 500 and Nasdaq Composite indexes both hitting record highs intraday, on good corporate earnings, the government approval of the merger between T-Mobile and Sprint, and better-than-expected economic growth. Read More...

Stocks rose Friday, with the S&P 500 and Nasdaq Composite indexes both hitting intraday record highs, led by technology stocks, on good corporate earnings, government approval of the T-Mobile and Sprint merger, and better-than-expected economic growth.

How are the major benchmarks faring?

The Dow Jones Industrial Average  DJIA, +0.24% rose 64 points or 0.2% to 27,206 while the S&P 500 index SPX, +0.80%  added 24 points, or 0.8% to 3,027. The Nasdaq Composite COMP, +1.18% advanced 100 points to 8,338 for a gain of 1.2%.

New all time highs intraday were seen for the S&P500 at 3,027.80 and for Nasdaq at 8339.64.

What’s driving the market?

Alphabet GOOG, +10.53%  , Starbucks SBUX, +9.03%  , McDonalds MCD, +0.42%   and Twitter TWTR, +8.87%  all reported better-than-expected earnings late Thursday or early Friday.

More than 40% of S&P 500 companies have reported quarterly earnings for the second quarter and 76.4% have posted a stronger-than-forecast profit, according to FactSet.

The U.S. Justice Department officially approved the merger between T-Mobile US Inc TMUS, +5.02%  and Sprint Corp S, +7.33%  provided the wireless carriers divest assets to Dish Network Corp DISH, +0.46% leading to gains for all three stocks.

On the economic front, the U.S. economy grew at an annualized pace of 2.1% in the second quarter, according to the Commerce Department, slowing from 3.1% in the first three months of the year, but faster than the 1.9% expected by economists, per a MarketWatch poll.

Some of the details of the report were stronger than the headline number, with consumer spending surging to 4.3% growth from a 1.1% gain in the first quarter. However, business investment shrunk 0.8%, the biggest drop in three and a half years, a figure that likely provides enough cause for concern to keep the Federal Reserve on track to deliver an interest rate cut when it meets next week.

“The data clearly shows signs of a bifurcated economy,” wrote Michael Reynolds, investment strategy officer at Glenmede, in an email. “Weakness in manufacturing has weighed on components like inventories and fixed investment, but the healthy U.S. consumer has helped buoy the economy as seen in the stable reading on personal consumption expenditures.”

Read: The economy slows to 2.1% growth in the spring as businesses retrench, GDP shows

Despite the better-than-expected GDP data, the Fed is fully expected to cut interest rates by at least a quarter point when it meets July 30-31.

“The Fed still has the green light to cut rates,” said Stephen Gallagher, U.S. chief of economics at Societe Generale.

“It is pretty difficult to pull back from signaling rate cuts and the risks are still there,” Gallagher said.

Next week also brings resumption of trade talks between the U.S. and China in Shanghai but National Economic Council Director Larry Kudlow told CNBC that he would not expect “a grand deal” soon.

Which stocks are in focus?

Shares of Google parent Alphabet Inc. GOOG, +10.53% GOOGL, +10.42%  jumped Friday. After Thursday’s close, the company published second-quarter results that topped Wall Street profit and revenue expectations and announced a $25 billion share buyback program.

Also see: Big Tech antitrust probe leads to meeting between attorney general, state counterparts

Shares of Amazon.com Inc. AMZN, -1.67%  fell after the e-commerce giant reported results late Thursday that ended a year-long run of record quarterly profits.

Intel Corp. INTC, -1.12%  shares were up after the chip giant posted a big earnings beat and raised its outlook for the year late Thursday.

Opinion: Even Intel doesn’t seem to know what’s going to happen with Intel

Coffee retailer Starbucks Corp. SBUX, +9.03%  shares rose Friday after it bested forecasts for profit and sales late Thursday and raised its guidance for the year.

Shares of social-media company Twitter Inc. TWTR, +8.87%  jumped after the company posted better-than-expected user and revenue growth.

Dow component McDonald’s Corp. MCD, +0.42% reported second-quarter earnings and revenue that beat expectations, sending the stock up.

Shares of drugmaker AbbVie Inc. ABBV, +1.70%  rose after reporting second-quarter results Friday.

How are other markets trading?

The yield on the 10-year U.S. Treasury note TMUBMUSD10Y, -0.26%  was little changed around 2.07%.

In commodities markets, the price of crude oil CLU19, +0.30%  was flat around $56.27 per barrel, while gold prices GCQ19, +0.20% was steady around $1,419.10 per ounce. The U.S. dollar index DXY, +0.17%  was higher as the British pound fell to a new two year low at $1.2376.

Asian markets closed mixed overnight, with China’s CSI 300 000300, +0.19%  index rising 0.2%, Japan’s Nikkei 225 NIK, -0.45%  adding 0.5% and Hong Kong’s Hang Seng HSI, -0.69%  losing 0.7%.

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