Wall Street rises in good start to earnings season
15-Oct-19 16:25 ET
Dow +237.44 at 27024.80, Nasdaq +100.06 at 8148.71, S&P +29.53 at 2995.68
briefing.com
[BRIEFING.COM] The S&P 500 rose 1.0% on Tuesday, as JPMorgan Chase (JPM 119.96, +3.51, +3.0%), UnitedHealth (UNH 238.59, +18.00, +8.2%), and Johnson & Johnson (JNJ 132.84, +2.12, +1.6%) kicked off the third quarter reporting season with better-than-expected earnings results.
The Dow Jones Industrial Average gained 0.9%, the Nasdaq Composite gained 1.2%, and the Russell 2000 gained 1.2%.
Most of today's advance came in the early going. The S&P 500 opened just 0.3% higher, and it quickly pushed to session highs amid news that the EU and UK are nearing a draft Brexit deal and that General Motors (GM 36.26, +0.76, +2.1%) and the UAW could also reach a deal soon. Although nothing was finalized, the optimism helped solidify a risk-on mindset following today's batch of better-than-feared earnings results.
The benchmark index traded around the 3000 level for most of the session, supported by gains in nine of its 11 sectors. The health care sector (+1.8%) provided the leadership, followed by the communication services (+1.6%) and financials (+1.3%) sectors. The consumer staples (-0.4%) and utilities (-0.3%) sectors ended the day lower.
Wells Fargo (WFC 50.07, +0.80, +1.6%), Citigroup (C 71.23, +0.99, +1.4%), and Goldman Sachs (GS 206.41, +0.59, +0.3%) each began the day in negative territory after the banks provided mixed results, but a turnaround in shares provided extra support for the early move higher.
Elsewhere, the Philadelphia Semiconductor Index (+2.2%) set a new all-time high on Tuesday. 29 of its 30 components finished higher, with NVIDIA (NVDA 196.37, +9.84, +5.3%) advancing the most after its price target was raised to $250 from $225 at Bank of America/Merrill Lynch.
Trade news continued to make headlines, although the muted reaction likely reflected some exhaustion to trade speculation. "People familiar with the matter" told Bloomberg News that China may struggle fulfilling part of its agreement to purchase $50 billion of U.S. agricultural goods unless President Trump lifts retaliatory tariffs.
U.S. Treasuries finished near their session lows, leaving yields slightly higher. The 2-yr yield increased one basis point to 1.61%, and the 10-yr yield increased two basis points to 1.77%. The U.S. Dollar Index declined 0.2% to 98.31. WTI crude declined 1.4%, or $0.76, to $53.55/bbl.
Tuesday's economic data was limited to the Empire State Manufacturing Survey for October, which increased to 4.0 (Briefing.com consensus -1.0) from 2.0. On Wednesday, investors will receive Retail Sales for September, Business Inventories for August, the weekly MBA Mortgage Applications Index, and Net Long-Term TIC Flows for August.
- Nasdaq Composite +22.8% YTD
- S&P 500 +19.5% YTD
- Dow Jones Industrial Average +15.9% YTD
- Russell 2000 +13.0% YTD
Market Snapshot
| Dow | 27024.80 | +237.44 | (0.89%) | | Nasdaq | 8148.71 | +100.06 | (1.24%) | | SP 500 | 2995.68 | +29.53 | (1.00%) | | 10-yr Note | -25/32 | 1.770 |
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| | NYSE | Adv 1846 | Dec 1015 | Vol 733.7 mln | | Nasdaq | Adv 2204 | Dec 866 | Vol 1.8 bln |
Industry Watch
| Strong: Health Care, Communication Services, Financials |
| | Weak: Consumer Staples, Utilities, Real Estate |
Moving the Market
-- Stocks rise in good start to Q3 earnings season
-- JPMorgan Chase (JPM) and UnitedHealth (UNH) finish noticeably higher following positive, and better-than-feared, earnings results
-- The UK and EU reportedly closing in on a draft Brexit deal
-- Risk-on mindset, although trading volume wasn't too great
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