Gains On Wall Street Boosted By Alphabet, Netflix

US indexes surged on Friday after Netflix kicked off the earnings season for growth stocks with positive move, while Google parent Alphabet gained on news of job cuts.

Shares of Netflix jumped 6.8% as the company added more subscribers than expected in the Q4 and said co-founder Reed Hastings was stepping down as chief executive. Quarterly update comes as the technology sector faces gloomy expectations because of rising interest rates and economic concerns that forced companies such as Microsoft Corp and Amazon to lay off thousands of employees.

Alphabet 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, investors have the sense that things may not be as bad as feared for tech stocks. 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.

Concerns about corporate earnings remain as the US economy shows signs of a slowdown and recession worries increase.