Wall Street Climbs On Big Tech Enthusiasm

• U.S. stocks rose on Tuesday on investors' renewed enthusiasm for expected earnings reports from mega-cap technology companies Alphabet and Microsoft amid signs of economic resilience. A survey showed consumer confidence increased to a two-year high in July, amid continued optimism about the labour market despite worries about a recession.
• U.S. tech giants are expected to signal an end to a nearly year-long slowdown in their cloud businesses as technology spending and digital ads are likely to pick up. Investor fascination with artificial intelligence is a positive influence for mega-cap tech firms, said Steve Sosnick, chief strategist at Interactive Brokers. "When you have this much enthusiasm for a specific investing theme, you don't need much of a reason for markets to move. It's inertia."
• With the U.S. central bank on track for another 25-basis point interest rate hike on Wednesday, policymakers face a choice over how much weight to put on recent economic data. The tech-heavy Nasdaq Composite index has rallied nearly 35.2% this year, helped by outsized gains in rate-sensitive mega-cap growth companies on optimism over artificial intelligence and hopes of an end to the U.S. Federal Reserve's tightening cycle.
• "Tech sold off horribly in 2022, so it's no surprise that it has come back so strong because investors believe the Fed is either done or close to being done with its tightening cycle and that's all the market wants," said M. Jake Dollarhide, chief executive officer at Longbow Asset Management.

(Source: Reuters)