Oct 14 Reuters - Wall Street's main indexes rallied on Thursday, boosted by technologies stocks and strong quarterly results from Bank of America and Walgreens, while better than expected economic data eased some concerns about higher inflation.
Citigroup, Bank of America Corp and Morgan Stanley have topped quarterly earnings estimates, helped by release of more reserves to cover loan losses, with tough dealmaking, equity financing and trading activity adding to their profits.
Their shares gained between 0.1% and 3.3%. Walgreens Boots Alliance Inc jumped 5.9% to top the S&P 500 and Dow Jones after the drugstore chain reported fifth-quarter revenue and forecast earnings above estimates and adjusted growth of 11% to 13% in long term.
The market strength today is partly predicated on better than expected earnings, said Andre Bakhos, managing director of New Vines Capital LLC in Bernardsville, New Jersey.
All 11 major S&P sectors advanced, with nine of them more than 1% in value. The Russell 2000 index added 1.3% to the small caps of the stock market.
The biggest boost came from growth names like Facebook Inc, Microsoft Corp., Apple Inc. and Google-parent Alphabet, which increased more than 1% over last year's figures.
There seems to be a tiny bit of FOMO fear of missing out, but there's a broadening out in markets, the buyers are coming into stocks broadly and arguably that's a healthy thing, said John Augustine, chief investment officer of Huntington Private Bank.
Analysts expect corporate America to report strong quarterly profit growth and will focus on commentary from companies on how they will battle rising costs, labor shortages and supply chain disruptions.
Meanwhile, data showed the number of Americans filing new claims for unemployment benefits decreased last week close to a 19-month low, while a separate report showed producer prices eased in September.
The reports came one day after consumer prices rose solidly in September, which further strengthened the case for a rate hike by the Federal Reserve.
Jobless claims came out better than expected which is good however, we have a situation where investors are going to read that if the job market improves rapidly, Bakhos said.
ET, the Dow Jones Industrial Average was up 34,877 points or 1.45% to 499.56. 37, the S&P 500 was up 67.63 points or 1.55% to 4,431 in the S&P 500. 43, and the Nasdaq Composite was up 237.63 points or 1.63% to 14,809. UnitedHealth Group Inc jumped 4.3% after the insurance giant's whole-year adjusted profit forecast increased on strength of its Optum unit managing drug benefits.
The advancing issues outnumbered declining bonds by a 4.07 - to -1 ratio in the Nasdaq and by a 2.37 - to 1 ratio on the NYSE.
The S&P index recorded 29 new 52 Week Highs and no new lows, while the Nasdaq counted 61 new highs and 28 new lows.