Key takeaways
- The S&P 500 gained 0.5% on Friday, June 5, 2024, after the latest jobs report showed signs of a cooling labor market, raising expectations for a rate cut.
- Shares of the meta platform rose amid signals that parent Facebook's AI investment may be starting to pay off.
- Shares of Southwest Airlines fell. The company recently adopted a “poison pill” plan intended to prevent an activist investor from acquiring more shares.
Major U.S. equity indexes rose to close the short trading week after the Independence Day holiday.
Friday's gains came after a cooling pace of jobs in the June jobs report and a rise in the unemployment rate, ending expectations that the Federal Reserve could cut interest rates in the coming months.
The S&P 500 gained 0.5% for the third consecutive session, hitting an all-time closing high. A 0.9% jump pushed the Nasdaq closer to another record. After trading in negative territory for most of the session, the Dow closed up 0.2% at midday.
Shares of Facebook and Instagram parent Meta Platforms ( META ) rose 5.9%, marking Friday's best performance in the S&P 500 and posting an all-time high for the stock. The gain comes amid hopes that Meta's massive investment in artificial intelligence (AI) technology could boost earnings, with analysts at Bernstein recently pointing out that AI-driven Algorithms are increasing users' time in Metakey's apps.
Shares of Baxter International ( BAX ) surged 5.3 percent after reports that the healthcare technology firm is in talks to sell its kidney care spin-off Ventio to private equity firm Carlyle Group ( CG ). Sources said the companies have held exclusive talks about a $4 billion deal, including debt.
Rising AI optimism helped boost shares of semiconductor manufacturer Advanced Micro Devices (AMD), which rose 4.9%. AMD is poised to ramp up shipments of its latest generation of graphics processing units (GPUs) suited for generative AI applications, and analysts expect new AI-related product launches in the second half of the year. are
Shares of Southwest Airlines ( LUV ) fell 5.7 percent, marking the biggest losses of any S&P 500 component on Friday. The company earlier this week adopted a “poison pill” shareholder rights plan aimed at preventing activist investor Elite Investment Management from acquiring more shares. The activist firm has called for a change in leadership.
Shares of First Solar ( FSLR ) sank 3.9 percent to cap a volatile week of trading for the solar technology firm. The stock fell on Tuesday after Baird analysts trimmed their price target on updated cost and pricing expectations, then rebounded strongly in Wednesday's short session. First Solar has drawn attention to the potential for AI data centers to help power demand, but it faces uncertainty surrounding the upcoming presidential election and the future of U.S. clean energy policies.
Shares of computer memory and data storage provider Micron Technology ( MU ) fell 3.8 percent. Stocks have also benefited from AI-related optimism, but Micron issued soft earnings guidance when it reported its quarterly earnings last week, raising questions about its pace of growth.