Key points:

  • The S&P 500 and Nasdaq rose for the fourth day in a row, hitting new record closing highs.
  • Broadcom shares soared 12.3% after raising its earnings forecast and announcing a stock split.
  • Adobe raised its 2024 earnings forecast, sending shares up more than 16%.

Thursday marked a record fourth straight gain for the S&P 500 and Nasdaq, as technology stocks continued to rally. At the same time, the Dow Jones Industrial Average showed a decline.

The S&P 500 added 12.71 points, or 0.23%, to close at 5,433.74. The Nasdaq Composite rose 59.12 points, or 0.34%, to 17,667.56. The Dow Jones, by contrast, lost 65.11 points, or 0.17%, to finish the day at 38,647.1.

Thus, the technology sector continues to dominate the market, while other sectors show mixed performance.

Broadcom is the tech sector’s main catalyst

The S&P 500 technology sector posted an impressive 1.4% gain, hitting new record closing highs. The semiconductor index showed similar growth, adding 1.5%.

The catalyst for growth was Broadcom, whose shares soared 12.3% after raising its revenue forecast for semiconductors used in artificial intelligence technologies. Additionally, the company announced a forward stock split of 10 to 1.

Shares of Nvidia and Apple also showed gains, adding 3.5% and 0.5%, respectively. Tesla showed an increase of 2.9%, while the company’s shareholders had to approve Elon Musk’s $56 billion pay package.

Trading volume on US exchanges was 10.14 billion shares, below the average for the last 20 trading days (12.49 billion).

Adobe’s AI integration efforts are paying off

Amid economic uncertainty, Adobe is demonstrating confidence in its outlook by raising its fiscal 2024 revenue forecast. The catalyst for growth was the shift to AI-powered editing tools, demonstrating growing demand for Adobe solutions from businesses and consumers.

The company expects revenue in the range of $21.40 billion to $21.50 billion, higher than its previous forecast. Analysts, in turn, predicted $21.46 billion.

Adobe’s higher forecasts reflect the successful adoption of AI-powered solutions such as Premiere Pro, Animate and After Effects, which are in demand among creative professionals in a variety of fields.

In April, the company announced the integration of an artificial intelligence tool for creating images into Photoshop, which will allow it to strengthen its competitive position in the market in confrontation with OpenAI, Stability AI and Midjourney.

Additionally, Adobe raised its full-year adjusted earnings per share forecast to a range of $18 and $18.20 per share, up from its previous forecast of $17.60 and $18 per share.