news/GOOGL/2023.01.20/Wall Street gains on boost from Alphabet, Netflix.txt

(For a Reuters live blog on U.S., UK and European stock
markets, click LIVE/ or type LIVE/ in a news window.)*Netflix co-founder Hastings steps down as CEO*Google parent Alphabet to lay off 12,000 workers*Goldman Sachs falls on report of probe*Indexes up: Dow 0.34%, S&P 0.86%, Nasdaq 1.44%Jan 20 (Reuters) -Wall Street's main indexes rose on Friday after Netflix
kicked off the earnings season for growth stocks on an upbeat
note, while Google parent Alphabet gained on news of job cuts.Shares of Netflix Inc jumped 6.8% as the streaming
company added more subscribers than expected in the fourth
quarter and said co-founder Reed Hastings was stepping down as
chief executive.Netflix's quarterly update comes as the technology sector
faces gloomy prospects due to rising interest rates and economic
worries that have forced companies such as Microsoft Corp
and Amazon.com Inc to lay off thousands of
employees.Alphabet Inc was the latest to join the list as it
said it was cutting 12,000 jobs on Friday. The company's shares
rose 4.1%.The gains made communication services stocks the
top gainer among major S&P 500 sectors, climbing 2.7% with
information technology in tow, helped by a 2.9% rise
in Microsoft."Between Netflix and job cuts at Alphabet we have the sense
that things may not be as bad as feared (for tech stocks)," said
David Russell, vice president of market intelligence at
TradeStation Group."Those layoffs are actually a potential positive. Big
Silicon Valley firms are good at managing earnings and these
layoffs create the potential for some interesting guidance going
forward."The utilities sector, generally known as
"defensive", fell 0.6%.Still, concerns about corporate earnings remain as the U.S.
economy shows signs of a slowdown and recession worries
increase.Analysts now expect year-over-year earnings from S&P 500
companies to decline 2.9% for the fourth quarter, according to
Refinitiv data, compared with a 1.6% decline in the beginning of
the year.Wall Street's main indexes ended the previous session lower
after resilient labor market data renewed concerns the Federal
Reserve would continue its aggressive rate-hiking cycle despite
recent evidence pointing to easing price pressures.Commentary from Fed officials has pointed to a terminal rate
above 5%, while money market participants still bet rates
peaking at 4.9% by June and see a 93.7% chance for a 25-basis
point rate hike in February.Philadelphia Fed President Patrick Harker repeated on Friday
his view that it's time to move to a slower pace of rate rises,
while outgoing Kansas City Fed President Esther George said more
evidence is needed to gauge a slowdown in services sector
inflation.At 12:12 p.m. ET, the Dow Jones Industrial Average
was up 110.93 points, or 0.34%, at 33,155.49, the S&P 500
was up 33.47 points, or 0.86%, at 3,932.32, and the Nasdaq
Composite was up 156.63 points, or 1.44%, at 11,008.90.Weighing on the Dow, shares of Goldman Sachs Group Inc
dropped 2.2% after the Wall Street Journal reported the
Federal Reserve is probing the company's consumer business.Advancing issues outnumbered decliners by a 2.40-to-1 ratio
on the NYSE and by a 2.17-to-1 ratio on the Nasdaq.The S&P index recorded one new 52-week high and four new
lows, while the Nasdaq recorded 52 new highs and 16 new lows.
(Reporting by Shreyashi Sanyal and Amruta Khandekar; Additional
reporting by Shubham Batra in Bengaluru; Editing by Anil
D'Silva, Shounak Dasgupta and Maju Samuel)