Solid Earnings Drive US Stocks Higher 10/26 13:12
Stocks rose in afternoon trading on Wall Street Tuesday and pushed major
indexes further into record heights as investors review mostly solid company
(AP) -- Stocks rose in afternoon trading on Wall Street Tuesday and pushed
major indexes further into record heights as investors review mostly solid
The S&P 500 index rose 0.3% as of 12:07 p.m. Eastern and is hovering just
above the record high it set on Monday. The Dow Jones Industrial Average rose
39 points, or 0.1%, to 35,780 and is also just above its record high. The
Nasdaq rose 0.3%.
Technology stocks did much of the heavy lifting for the broader market. A
mix of companies that rely on consumer spending for goods and services also
made solid gains.
Communications stocks fell. Facebook shed 4% after giving investors a weak
sales forecast. The company is also facing scrutiny over its seemingly lax
regulation of harmful and misleading information on its platform.
Bond yields were steady. The yield on the 10-year Treasury remained at 1.63%
from late Monday.
Solid earnings reports helped lift several major companies. UPS jumped 7.4%
as higher shipping rates helped the package delivery service easily beat
analyst's third-quarter profit forecasts. Hasbro rose 3.4% after the maker of
Transformers, My Little Pony and other toys reported solid financial results.
Stocks have been pushing broadly higher as companies turn in much stronger
profit reports for the summer than analysts had expected.
"Right now, valuations are high and the market needs some reassurance from
corporate earnings," said Ernesto Ramos, chief investment officer in the U.S.
for BMO Global Asset Management. "There are still plenty of risks out there,
but the market is focusing on the good things right now."
Investors received several encouraging economic updates on Tuesday. U.S.
consumer confidence rose in October after three straight declines as the
public's anxiety about the delta variant of the coronavirus appear to have
abated. New home sales jumped 14% in September to the fastest pace in six
months as strong demand helped offset rising prices.
The broader market is also reacting well to signals that big spending plans
in Washington and potential tax increases for companies will likely be diluted,
Wall Street is still concerned about how much of an impact supply chain
problems will have on a wide range of industries. Many companies have already
warned about higher costs cutting into operations.
Paint maker Sherwin-Williams was little changed after its latest results
revealed that higher raw materials costs crimped its finances.
Microsoft and Google's parent company, Alphabet, will report their own
results after the closing bell Monday, along with Twitter. European markets
were higher and Asian markets closed mixed.
Investors still have a busy week of corporate earnings ahead. Airplane maker
Boeing and beverage company Coca-Cola will report their results on Wednesday.
General Motors and Ford will also release their results on Wednesday. The
reports could help give investors a clearer picture of how the auto industry is
dealing with supply chain problems, including a chip shortage that has been
weighing on auto production.
Apple and Amazon will report on Thursday. The companies, along with
Microsoft and Google, are the four biggest companies on Wall Street by market
value and their stock movements have a huge effect on the S&P 500.