NEW YORK, Jan 24 — Wall Street rallied today with the benchmark S&P 500 scaling record intraday levels, as Netflix surged after smashing expectations for subscriber growth, while chip stocks gained on ASML’s strong earnings.

The S&P 500 hit an intraday all-time high for the third time in less than a week, fuelling a bull-market run it confirmed on Friday after closing at a record. The blue-chip Dow had also surpassed the 38,000-point mark for the first time on Monday.

The tech-laden Nasdaq is around 4 per cent away from breaching its all-time high hit in November 2021.

Shares of Netflix rose 12.9 per cent to a two-year high after the firm’s largest-ever fourth-quarter subscriber growth indicated it had won streaming wars with its password-sharing crackdown and a strong content slate.

The communication services sector housing the stock led sectoral gains with a 1.6 per cent rise.

"The Netflix number caught everybody by surprise, and my expectation was that the subscriber growth for all the streaming services will continue to contract and that was a bit of an anomaly,” said Phil Blancato, CEO of Ladenburg Thalmann Asset Management.

Keeping investor euphoria in check, AT&T shed 2 per cent after forecasting annual profit below expectations, while DuPont De Nemours slid 13.4 per cent after forecasting a fourth-quarter loss, compared with a year-ago profit.

With the S&P 500 trading around 20 times forward 12-month earnings, compared with its long-term average of 16 times, the results of the "Magnificent 7” group of companies will be in focus to determine whether their valuations are justified.

Megacaps such as Microsoft, Amazon.com and Meta Platforms rose between 0.5 per cent and 1.7 per cent, as US Treasury yields fell. Tesla rose 0.1 per cent ahead of its fourth-quarter results later in the day.

Chip stocks including Nvidia, Advanced Micro Devices and Intel gained between 1.1 per cent and 3.4 per cent after European chip-making equipment maker ASML Holding beat fourth-quarter earnings estimates and posted record-high quarterly orders.

At 9.49am ET, the Dow Jones Industrial Average was up 89.52 points, or 0.24 per cent, at 37,994.97, the S&P 500 was up 22.07 points, or 0.45 per cent, at 4,886.67, and the Nasdaq Composite was up 103.43 points, or 0.67 per cent, at 15,529.37.

On the data front, a survey showed business activity picked up in January and inflation appeared to abate, suggesting that the economy kicked off 2024 on a strong note.

A resilient US economy and uncertainty over the timing of interest rate cuts have led investors to reassess their bets.

Traders now see an 87 per cent chance of a rate cut in May, according to CME Group’s FedWatch Tool. They were earlier expecting a rate cut in as early as March.

Among others, cloud firms Cloudflare, Snowflake and ServiceNow rose more than 1.3 per cent each on the back of German software firm SAP’s strong annual revenue growth forecast.

US-shares of Alibaba, Bilibili and Li Auto added between 1.6 per cent and 3.0 per cent after China’s central bank announced a deep cut to bank reserves.

Advancing issues outnumbered decliners by a 4.50-to-1 ratio on the NYSE and a 2.56-to-1 ratio on the Nasdaq.

The S&P index recorded 55 new 52-week highs and no new lows, while the Nasdaq recorded 78 new highs and 21 new lows — Reuters