Reuters, New York City -U.S. stocks increased on Friday, with the Nasdaq and S&P 500 ending at all-time highs. Technology companies gained on investors’ ongoing enthusiasm for artificial intelligence while falling Treasury yields provided additional support.

The Nasdaq broke its previous top of 16,212.23 in November 2021 thanks to increases that made it the market’s second consecutive record for closing. It also set an intraday record for names tied to artificial intelligence, such as Nvidia (NASDAQ: NVDA) and Meta Platforms (NASDAQ: META).

The three major indices saw gains until the end of February. They marked their fourth consecutive month of advances in a rally driven mainly by growth forecasts connected to artificial intelligence (A.I.), which has also helped semiconductor names.

Nvidia’s stock increased by 4% on Friday, closing above $2 trillion in market value for the first time. The shares of rival Advanced Micro Devices (NASDAQ: AMD) surged by 5.25% to conclude at a record high of $202.64. In comparison, the Philadelphia semiconductor index as a whole closed at a record high following a 4.29% increase during the session.

The robust economy has provided support to markets as traders have attempted to predict when the Federal Reserve will drop interest rates for the first time. Traders are presently focusing on June and view that the central bank will be able to soft-land the economy they are building.

“The Fed will be slower to lower interest rates because the economy is doing well and because inflation is still a little sticky,” stated Sam Stovall, chief financial analyst at CFRA Research in New York.

“But that’s good because then we’re gradually coming off of the higher interest rate cycle, and we do not require cutting rates aggressively.”

The S&P 500 gained 40.81 points, or 0.80%, to 5,137.08, the Nasdaq Composite gained 183.02 points, or 1.14%, to 16,274.94, and the Dow Jones Industrial Average increased by 90.99 points, or 0.23%, to 39,087.38.

The Nasdaq increased 1.74%, the Dow dropped 0.11%, and the S&P 500 gained 0.95% for the week.

The economy still exhibits areas of weakness, particularly in manufacturing, despite a robust services sector and a tight labor market. However, data released on Friday showed some indications of a potential recovery.

As a result, U.S. Treasury yields decreased, with the yield on a two-year note dropping as low as 4.519%.

Fed Governor Chris Waller stated that the Fed’s efforts to combat inflation are unaffected by impending decisions over the final size of its balance sheet.

Adriana Kugler, a fellow Fed governor, expressed cautious optimism that the central bank would continue to achieve disinflation without significantly hurting the labor market and that a wage-price spiral would not materialize. Thomas Barkin, the president of the Richmond Fed, stated that it is too soon to say when the Fed would be able to start lowering interest rates.

Of the 11 key sectors, the S&P 500 tech index (SPLRCT) performed the best, rising 1.78%, while utilities saw the worst decrease, down 0.72%.

Primary mover New York Community Bancorp (NYSE: NYCB) fell 25.89% after the regional lender revised its fourth-quarter loss to be ten times higher than previously reported and disclosed that it had discovered “material weaknesses” in internal controls related to its loan review. This news contributed to a 1.27% decline in the KBW regional banking index.

As a result of Dell Technologies’ (NYSE: DELL) higher-than-expected annual revenue and profit prediction, the producer of personal computers saw its highest daily percentage rise ever, rising to 31.62%.

A 1.83% decline in Boeing partially offset the Dow’s gains (NYSE: B.A.), which followed a report indicating that the aircraft manufacturer was in talks to acquire supplier Spirit AeroSystems (NYSE: SPR).

On the NYSE and the Nasdaq, advancing items were more significant than declining ones by a ratio of 2.29 to 1 and 1.55 to 1, respectively.

While the Nasdaq registered 363 new highs and 88 new lows, the S&P 500 recorded 87 new 52-week highs and 2 new lows.

Conclusion

The closing of the S&P 500 and Nasdaq at new highs signifies a robust market buoyed by technological advancements and favorable economic policies. It’s an invitation to engage with the market and capitalize on the upward momentum. However, it’s also an essential time for cautious and informed decision-making, as market conditions can change quickly. By staying aware of the market landscape and implementing sound investment principles, individuals can make the most of the current opportunities.

In your pursuit to grow your investments, remember to stay informed, adapt to dynamic market conditions, and seek professional advice when needed. Celebrate the market’s successes, but also exercise prudence in your financial endeavors. After all, smart investing is as much about preparing for the highs as it is for the lows.