Could the Bear Market Finally Be Over? Netflix and Palantir Point to Yes

After having seen a lot of uncertainty, Wall Street seemed to get a new burst of enthusiasm this week. Major stock indexes built on their gains from Wednesday, and the Nasdaq Composite (^IXIC 0.10%) led the way higher with a 1.5% gain. The Dow Jones Industrial Average (^DJI -0.11%) and S&P 500 (^GSPC 0.02%) also managed to gain ground, even though the Dow spent much of the day in negative territory.

Data source: Yahoo! Finance.

A couple of well-known stocks helped lead markets higher. Netflix (NFLX -3.92%) has become the leader of the streaming video industry, while Palantir Technologies (PLTR -0.23%) has thrived from digital transformation efforts. Both stocks got votes of confidence that sent their shares higher, and that has an increasing number of investors thinking that perhaps the bear market of 2022 is finally coming to an end.

Netflix gets early success from its ad-supported tier

Shares of Netflix climbed more than 9% on Thursday. The streaming video pioneer made a key announcement about how its recent foray into ad-supported programming has gone, and investors liked what they heard.

Netflix apparently has almost 5 million active users on its ad-supported tier, according to an executive presentation that was aimed to get advertisers to look more closely at the streaming platform's inventory of advertising space. That's a quick win for Netflix, which just launched advertising on its platform six months ago.

It's somewhat surprising that so many people have opted for the ad-supported option, given that its $7 per month price tag represents only a $3 discount from its basic plan. However, the ad-supported tier does offer users the same ability to watch on two supported devices in full HD resolution as its more expensive standard plan, whose price rose to $15.50 per month recently.

With more than 230 million paying subscribers, the ad-supported tier is only beginning to catch on among users. Nevertheless, both Netflix and the advertising community seem to think that more users will gravitate toward being willing to watch ads, and that having multiple revenue streams could help add to Netflix's profits over the long run.

Palantir gets another big buy from Cathie Wood

Elsewhere, shares of Palantir Technologies climbed even higher, jumping almost 15% on Thursday. News of a big purchase from a well-known fund manager concentrating on high-growth stocks helped to send the data analytics company's shares to their best levels in more than a year.

An update from Ark Invest, the fund company managed by Cathie Wood, indicated that the growth-oriented investor had added to positions in Palantir with purchases of more than 1.25 million shares across its funds. Admittedly, with the stock at a relatively low price, an addition of less than $15 million to funds with billions of dollars under management isn't a huge commitment, but it's nevertheless reflective of bullish sentiment from Wood and her analysts at Ark Invest.

Some investors have feared that Palantir's emphasis on government clients might hold back its long-term growth. However, the company has worked to expand its corporate offerings as well. Moreover, with hopes to tap into artificial intelligence trends, Palantir is emerging as a potential favorite for AI investors as well.

Palantir still has a long way to go to earn back all of its losses since early 2021. However, the fundamentals of its business look poised to recover, which could help build further momentum in the weeks and months to come.