US STOCKS-S&P 500, Nasdaq hit record highs on megacaps, earnings strength

Reuters

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    * Social media stocks rally after upbeat results 
    * AmEx jumps on blowout Q2 profit
    * Intel sales forecast implies rocky second half
    * Indexes up: Dow 0.51%, S&P 0.77%, Nasdaq 0.80%

 (Adds comments, updates prices to early afternoon)
    By Devik Jain and Shreyashi Sanyal
    July 23 (Reuters) - The S&P 500 and Nasdaq indexes hit
record highs on Friday and were on track to end the week with
gains, helped by megacap growth stocks and strong earnings from
social media companies, while a weak forecast from Intel hit
chipmakers.
    Twitter Inc  TWTR.N  gained 4.2% after it reported quarterly
revenue growth, while Snapchat-owner Snap Inc  SNAP.N  surged
22.5% on beating estimates for user growth and revenue.
 urn:newsml:reuters.com:*:nL1N2OY2G2 urn:newsml:reuters.com:*:nL1N2OY2H1
    Strong results from the social media firms set a positive
precedent for Facebook Inc  FB.O , which jumped 6.7%.
    Other growth firms including Amazon.com  AMZN.O , Apple Inc
 AAPL.O , Microsoft Corp  MSFT.O  and Google-owner Alphabet Inc
 GOOGL.O  rose ahead of their quarterly results next week.
    Technology  .SPLRCT  and communication services  .SPLRCL ,
which house some of those big tech heavyweights, added 0.9% and
2.5% respectively, and were among the top gaining S&P sectors.
    The major indexes were set for their fourth weekly gain in
five weeks on a boost from positive earnings reports, while the
Nasdaq 100 index  .NDX  breached 15,000 points for the first
time.
    "The tech earnings will be phenomenal ... I'm not sure that
they're going to be market leaders, they will be earnings
leaders," said George Ball, chairman at Sanders Morris Harris in
Houston, Texas.
    "The key is, what happens next. You're going to be comparing
to a higher base than previously and in the third and fourth
quarters, we'll be looking backward to a largely post-COVID
level of earnings, and so the increases will not be as large."
    American Express Co  AXP.N  gained 2.6% and was the top
boost to the S&P 500 financials sector  .SPSY  after its
second-quarter profit blew past expectations.  urn:newsml:reuters.com:*:nL4N2OZ1PV
    Intel Corp  INTC.O  slid 5.8%, leading the declines on the
Philadelphia SE Semiconductor index  .SOX , after it gave an
annual sales forecast that implied a weak end of the year.
 urn:newsml:reuters.com:*:nL4N2OY37J
    The second-quarter earnings season barreled ahead, with 120
companies in the S&P 500 having reported numbers so far. Of
those, 88.3% have beaten consensus estimates, according to
Refinitiv data.
    Wall Street investors have shifted between growth stocks and
economically sensitive value shares this week, after concerns
about the spread of the Delta coronavirus variant roiled markets
and sparked a flight to the perceived safety of bond markets on
Monday.
    Meanwhile, data from IHS Markit showed business activity
grew at a moderate pace for a second straight month in July amid
supply constraints.  urn:newsml:reuters.com:*:nZON003H24
    The Federal Reserve's policy meeting next week will be
closely watched for further hints about tapering amid a spike in
COVID-19 cases, though Chair Jerome Powell has repeatedly said
the labor market remains well short of its target.  urn:newsml:reuters.com:*:nL1N2OW0XI
    At 11:59 a.m. ET, the Dow Jones Industrial Average  .DJI 
was up 176.87 points, or 0.51%, at 35,000.22, the S&P 500  .SPX 
was up 33.53 points, or 0.77%, at 4,401.01 and the Nasdaq
Composite  .IXIC  was up 117.09 points, or 0.80%, at 14,801.69.
    Advancing issues outnumbered decliners by a 1.26-to-1 ratio
on the NYSE. Declining issues outnumbered advancers for a
1.28-to-1 ratio on the Nasdaq.
    The S&P index recorded 73 new 52-week highs and no new low,
while the Nasdaq recorded 74 new highs and 119 new lows.

 (Reporting by Devik Jain and Shreyashi Sanyal in Bengaluru;
editing by Uttaresh.V and Maju Samuel)
 ((Devik.Jain@thomsonreuters.com; within U.S. +1 646 223 8780;
outside U.S. +91 80 6182 2062; ;))

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