Wall Street shares close up as megacap tech stocks rally
- March PCE data in line with estimates
- Alphabet jumps on first-ever dividend, $70 bln buyback plan
- Microsoft gains after earnings beat estimates
- Indexes up: Dow 0.40%, S&P 1.02%, Nasdaq 2.03%
U.S. stocks closed higher on Friday, buoyed by a rally in megacap growth stocks following robust quarterly results from technology heavyweights Alphabet 
GOOG and Microsoft 
MSFT in addition to moderate inflation data.
Investors cheered Alphabet's first-ever dividend, its $70 billion stock buyback program, and better-than-expected first-quarter results. Its shares jumped 10% and reached a record high, lifting the Google-parent's market value above $2 trillion.
Microsoft MSFT shares rose 1.8% after its third-quarter revenue and profit exceeded Wall Street estimates, driven by gains from artificial intelligence (AI) adoption across its cloud services.
Other megacap growth stocks also closed higher: Amazon.com 
AMZN rose 3.4%, Nvidia 
NVDA gained 5.8%, and Meta Platforms 
META added 0.4%. However, Apple 
AAPL fell 0.3% and Tesla 
TSLA closed down 1.1%. On Wednesday, Meta results had disappointed investors even as the company ratcheted up spending on AI.
Six out of the 11 major S&P 500 sectors finished higher, led by gains in communication services 
S5TELS, technology 
S5INFT, consumer discretionary S5INFT and materials 
S5MATR.
The S&P 500 and the Nasdaq registered their biggest weekly percentage gains since early November 2023. Benchmark S&P 500 
SPX snapped three weeks of losses, while the Nasdaq 
IXIC ended four straight weeks of declines.
"The earnings reports of Microsoft and Google allayed a lot of the concerns about the fact that the spending on data centers and AI, which Meta had raised a day before, was going to compress margins," said Tom Plumb, president and lead portfolio manager at Plumb Funds in Madison, Wisconsin.
"Both Google and Microsoft had indicated that with their current capital plans, they still expected their margins to expand. That allayed a lot of the fears that people had about the growth of data computing," Plumb added.
U.S. Commerce Department data showed monthly inflation rose moderately in March on an annual basis while coming in line with estimates on a monthly basis.
The report offered some relief to financial markets spooked by worries of stagflation a day after data showed inflation surging and economic growth slowing in the first quarter.
After the data, money markets priced in a firmer chance of a Federal Reserve rate cut in September. The yield on the benchmark 10-year Treasury note 
US10Y fell after the data, last standing at 4.6630%.
The Dow Jones Industrial Average 
DJI rose 153.86 points, or 0.40%, to 38,239.66, the S&P 500 SPX gained 51.54 points, or 1.02%, to 5,099.96 and the Nasdaq Composite IXIC gained 316.14 points, or 2.03%, to 15,927.90.
Shares of Snap 
SNAP surged nearly 28% after the social media firm beat first-quarter estimates for revenue and user growth. Pinterest 
PINS shares also finished up 4%.
Exxon Mobil 
XOM lost ground by nearly 3% after America's largest oil company missed analysts' estimates with first-quarter profit falling 28% from a year ago.
Intel 
INTC dropped 9.1% after the chipmaker's forecast for second-quarter revenue and profit did not meet estimates. Intel faces weak demand for its traditional data center and PC chips.
Advancing issues outnumbered decliners by a 2.25-to-1 ratio on the NYSE. On the Nasdaq, 2,685 stocks rose and 1,460 fell as advancing issues outnumbered decliners by a 1.84-to-1 ratio.
The S&P 500 posted 21 new 52-week highs and eight new lows while the Nasdaq recorded 59 new highs and 88 new lows.
Volume on U.S. exchanges was 9.88 billion shares, compared with the 11.01 billion average for the last 20 days.