Key takeaways
- The S&P 500 rose 0.6% on Wednesday January 22, 2025, following the announcement of major investments in AI and a series of positive results publications.
- Netflix shares took off after the video streamer beat quarterly estimates and reported strong subscriber additions.
- The uncertain outlook for renewable energy under the new presidential administration has weighed on shares of First Solar and several companies with exposure to wind energy.
Major US stock indexes rose after President Trump introduced a joint venture that will inject significant investment into artificial intelligence (AI) infrastructure and investors digested a string of strong results.
After hitting a record intraday high above 6,100, the S&P 500 ended the session with a 0.6% gain, finishing just below its all-time closing high. The Dow Jones rose 0.3%, while strength in the technology sector helped the Nasdaq climb 1.3%.
Video streaming giant Netflix (NFLX) reported better-than-expected fourth-quarter sales and profits, and its shares climbed 9.7%, notching the best performance in the S&P 500 on Wednesday. Netflix also said it added 19 million new subscribers during the period, increased its share repurchase program by $15 billion and raised its revenue outlook for 2025. JPMorgan analysts said they expected expected minimal resistance to the subscription price increases announced by Netflix, highlighting the platform’s strong programming this year.
Shares of power management chipmaker Monolithic Power Systems (MPWR) jumped 8.0% on Wednesday, adding to a string of gains dating back to last week. The rally coincided with several research firms listing Monolithic Power stock among their “top picks.” Analysts at Deutsche Bank highlighted expectations for revenue growth and margin expansion from Monolithic over the coming years, while analysts at Oppenheimer noted that the semiconductor industry’s transition towards higher power modules could help support the company’s long-term growth.
Shares of Moderna (MRNA) jumped 7.3%. The biotech company received nearly $600 million in additional funding from the U.S. Department of Health and Human Services to advance its development of mRNA vaccines against pandemic-prone flu strains, including H5N1 avian flu strain. An additional boost for Moderna came when Larry Ellison, chairman of Oracle (ORCL), spoke at a White House meeting about the potential of artificial intelligence (AI) in developing cancer vaccines .
Shares of Seagate Technology Holdings (STX) rose 6.8% following a strong earnings report. The world’s largest hard drive maker beat quarterly sales and profit estimates, reflecting improving demand. Morgan Stanley analysts confirmed bullish trends in the hard-drive industry, including Seagate stock among their top picks and indicating that consensus forecasts may be underestimating the company’s gross margin trajectory.
Shares of Edison International (EIX), operator of Southern California Edison, the region’s largest utility suffering from a torrent of devastating wildfires, fell 6.3%, the largest decline in all stocks in the S&P 500. On Tuesday, a judge ordered Edison to preserve evidence and data related to the origins of the Eaton Fire. Several area homeowners have filed lawsuits, saying the company’s equipment may have played a role in starting the fire. Previous wildfires in the state were related to electrical equipment and resulted in significant liabilities for utility companies.
Shares of First Solar (FSLR) fell 6.3% on Wednesday, extending losses recorded in the previous session after President Donald Trump returned to office and announced the elimination of several energy initiatives. renewable energies. Although the solar panel maker’s shares have been volatile in recent months, they are down about 20% since Trump’s election victory in November.
President Trump’s first round of executive orders included a measure to suspend permitting processes for wind energy projects, pending review by the Interior Department. This policy change weighed on stocks of companies exposed to onshore and offshore wind power generation. Shares of AES Corp. (AES) and Dominion Energy (D) fell 5.3%.
