The major averages finished the week with yet another round of record highs as Wall Street looked past disappointing results from major companies to wrap up its best month of the year. The Dow Jones Industrial Average rose 89 points or 0.25%. The S&P 500 rose 8 points or 0.2% while the Nasdaq Composite rose 50 points or 0.33%. All three closed at record highs, and the S&P 500 and Nasdaq had their best months since November 2020.
Amazon shares dropped 3% after the e-commerce giant badly missed earnings and revenue expectations for the third quarter. The company also issued disappointing guidance for the critical holiday period.
Apple stock fell 2.4% after the tech giant's quarterly revenue fell short of expectations amid larger-than-expected supply constraints on iPhones, iPads and Macs. It was the first time Apple's revenues have missed Wall Street estimates since May 2017.
On the positive side, Visa and Microsoft were two of the best performers in the Dow. Microsoft surpassed Apple to be the largest listed company in the world by market cap.
Despite the recent disappointing results from Big Tech, the stock market has been raking in records amid solid earnings even with global supply chain concerns. About half of the S&P 500 have reported quarterly results and more than 80% of them beat earnings estimates from Wall Street analysts. S&P 500 companies are expected to grow profit by 38.6% year over year.
Shares of Exxon Mobil and Chevron rose after the energy giants topped earnings expectations. Starbucks was under pressure after revenue from China missed expectations.
All three major averages are on track to post a winning week, their fourth positive week in a row. Month to date, the S&P 500 and Nasdaq are up more than 6%, while the Dow is up more than 5%.
On Thursday, President Joe Biden announced a framework for a $1.75 trillion social spending deal. The agreement, which is expected to make it easier to pass the separate infrastructure spending bill currently stalled on Capitol Hill, came in lighter on spending and taxes than earlier proposals.
Yung-Yu Ma, chief investment strategist at BMO Wealth Management, said the deal appeared to be in a "sweet spot" and should create more optimism among investors.
Treasury Secretary Janet Yellen spoke to CNBC on Friday morning, saying she was hopeful that the administration's infrastructure package would be approved soon while saying she does not believe it will add to the inflation problems the U.S. has been experiencing.
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