Tech earnings send stocks higher

April 24, 2015 08:51 AM

U.S. stocks were set to open higher on Friday as strong results from tech behemoths Google, Amazon and Microsoft set the Nasdaq Composite on track to extend its run after surpassing on Thursday a 15-year-old record.

The Standard & Poor's 500 touched a record intraday high on Thursday, while the Nasdaq closed at 5,056.06, surpassing its record set in March 2000, just before the dot-com bubble burst.

"I think we're on more solid footing than the last time," said Gordon Charlop, managing director at Rosenblatt Securities in New York.

"There could be some vulnerability in some of the tech names, given the change in the value of the dollar, but I don't get the same sense that we're overvalued at these levels the way we were the last time we got here."

Futures barely budged after data showed U.S. business investment spending plans fell for a seventh straight month in March, likely weighed down by a strong dollar and lower energy prices.

Amazon shares jumped 12.7 percent to $439 in premarket trading after the e-commerce company's revenue came in above estimates.

Google rose 3.6 percent to $577.29 after reporting higher quarterly revenue and profit as rising online ad volume offset a hit from the strong dollar.

Microsoft shares rose 5.4 percent to $45.65 before the bell as the software giant's results topped Wall Street estimates.

Comcast shares rose 0.9 percent to $59.78 after it abandoned its proposed $45 billion merger with Time Warner Cable after U.S. regulators said the deal would give Comcast an unfair advantage in the Internet-based services market. Time Warner fell 0.5 percent to $148.

Xerox shares slumped 4.5 percent $12.55 after it cut its 2015 profit forecast, adding to a growing list of companies that have blamed a strong U.S. currency for weakened results or forecasts.

Apple gained 0.6 percent to $130.39 after the company said it aims to ship at least 20 million Apple Watches this year, well above many analysts' forecasts.

Of the 169 companies in the S&P 500 that have reported earnings so far, 71 percent have exceeded expectations but only 44 percent have beaten on revenue.

Futures snapshot at 8:56 a.m. EDT:

* S&P 500 e-minis were up 3.75 points, or 0.18 percent, with 171,109 contracts changing hands.

* Nasdaq 100 e-minis were up 31 points, or 0.69 percent, in volume of 39,082 contracts.

* Dow e-minis were up 19 points, or 0.11 percent, with 27,977 contracts changing hands.

About the Author

Tanya Agrawal, Reuters