U.S. stocks rise on expectations ahead of earnings season

515
2
U.S. stocks rise on expectations ahead of earnings season

Oct 18 Reuters - On Monday, U.S stocks rose on gains in heavyweight technology companies, although sentiment remained fragile due to slowing growth in China and concerns of elevated inflation due to a weakening oil prices.

Eight of the 11 major s&p 500 sectors rose, followed by consumer discretionary and led by energy, which took Brent crude oil to its highest level since October 2018.

The iPhone maker is expected to reveal new Mac laptops with more powerful processor chips at an event later in the day.

However, the global sentiment was stoked by China beginning its slowest economic growth in the third quarter of a year, hurting by power shortages and wobbles in the property sector.

There is some weak data out of China, which is concerning on a global basis, and then market participants showed up to this earnings with a very pessimistic view but banks dramatically exceeded expectations said Thomas Hayes, managing director of Great Hill Capital Llc in New York City.

In the days ahead, investors will keep a close eye on how Corporate America mitigates the impact from supply chain disruptions, labor shortages and higher costs on earnings, particularly in the wake of rising oil prices.

Forecast-beating results set a positive tone for third quarter earnings season, with analysts expecting S&P 500 earnings to show a 32% rise from a year ago, according to Refinitiv data.

The wall of earnings over the next two weeks will be key to the market's next move; a continuation of positive commentary should help keep the rally well-supported, said Chris Beauchamp, chief market analyst at IG.

Judging by the figures so far, it seems like earnings season will be the catalyst for further gains that eluded investors throughout September and early October. Johnson Johnson Johnson, insurer Travelers, Netflix Inc., California Communications, oilfield services cos Baker Hughes Co, Schlumberger NV, Tesla Inc. and Intel Corp are some of the companies who will report quarterly results this week.

ET, the Dow Jones Industrial Average was up 1.94 points, or 0.01%, at 35,296. 70, the S&P 500 was up 11.08 points or 0.25%, at 4,482 at 4,108. 45 and the Nasdaq Composite was up 67,77 points, or 0.45%, at 14,965 in 2014. Walt Disney slipped 2.9% after Barclays decreased the media giant's stock to equal weight from overweight Dynavax Technologies rose 2.6% after French biotech company Valneva SE reported positive results from its late-stage trial of its COVID - 19 vaccine candidate VLA 2001 using company's CpG 1018 adjuvant.

Advancing issues outnumbered decliners by a 1.04 ratio to 1 on the NYSE. Declining issues outnumbered advancers for a 1.06 to 1 ratio on the Nasdaq.

The Nasdaq index recorded 33 new highs in 52 weeks and no new low, while the S&P index reported 48 new highs and 93 new lows.