Stocks moving higher on Wall Street following solid earnings
Stocks are moving higher in afternoon trading on Wall Street Tuesday following a batch of solid earnings reports from U.S. companies.
The S&P 500 was up 1.1%, recouping some of its loss from a day earlier. Technology stocks, banks, and companies that rely on consumer spending helped lift the market. Overseas markets were mixed. Treasury yields held steady.
Procter & Gamble, Albertsons and Travelers all rose after reporting quarterly results that were better than analysts were expecting. More than 85% of the companies that have reported results so far have beaten analysts' forecasts, according to FactSet.
Investors also had their eye on Washington in hopes that Democrats and Republicans will reach a deal to deliver more aid for the economy. Fading optimism that an agreement on a new relief package will be reached before the election next month led to a late-afternoon sell-off on Monday.
“We have had a decently strong recovery out of the gate, but there are signs that it is maybe starting to slow,” said Charlie Ripley, senior investment strategist for Allianz Investment Management. “Additional stimulus aid is something that will benefit the economy.”
Shares in Google's parent company rose following news that the Justice Department sued the internet giant Tuesday, claiming Google has abused its dominance in online search and advertising to stifle competition and harm consumers.
The Dow Jones Industrial Average of big blue chips was up 291 points, or 1%, to 28,485 as of 1:18 p.m. Eastern time. The Nasdaq composite, which is coming off a five-day losing streak, was up 1.1%. The Russell 2000 index of small-cap stocks was up 1.1%.
Stocks have been mostly pushing higher this month after giving back some of their big gains this year in a sudden September swoon. The benchmark S&P 500 has notched a gain in each of the past three weeks. Even so, trading often has been choppy from one day to the next, reflecting uncertainty over the timing of more stimulus for the economy, something investors have been hoping for since July, when a supplemental $600-a-week unemployment benefit package ran out.
House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin negotiated for nearly an hour on Monday ahead of a Tuesday deadline for reaching a pre-election deal with the Trump administration on a new coronavirus relief package. A top aide of Pelosi’s called the talks productive.
Senate Majority Leader Mitch McConnell is expected to bring a GOP version of a stimulus bill to the floor of the Senate for a vote on Wednesday.
Google parent Alphabet rose 1.2% after the Justice Department sued the company for antitrust violations. The lawsuit could be an opening salvo ahead of other major government antitrust actions, given ongoing federal probes of other major tech companies, including Apple, Amazon and Facebook. Shares in Apple were up 2%, while Amazon was 0.8% higher. Facebook rose 1.4%.
Homebuilders rose broadly after the Commerce Department said U.S. home construction rose a solid 1.9% last month after having fallen in August. Applications for building permits, a good sign of future activity, also rose in September. TRI Pointe Group was among the biggest gainers, climbing 3.1%.
Procter & Gamble was holding on to a 0.3% gain after the consumer products company reported solid fiscal first-quarter results and raised its earnings outlook. Insurer the Travelers Cos. was up 5.3% after its latest earnings topped Wall Street's estimates, thanks partly to lower-than-expected losses on claims. Albertsons surged 4.7% following its latest quarterly results. The supermarket chain benefited from a sharp increase in online and in-store sales as customers continue to stock up on groceries due to the coronavirus.
Across the S&P 500, analysts are expecting companies to report another drop in profits for the summer from year-ago levels. But they’re forecasting the decline to moderate from the nearly 32% plunge from the spring as the economy has shown signs of improvement.
The yield on the 10-year Treasury note rose to 0.79 from 0.78% late Monday.
Stocks indexes in Europe were mostly higher. France's CAC 40 fell 0.3%, Britain's FTSE 100 rose 0.1% and Germany’s DAX slipped 0.9%.
Rising coronavirus caseloads in Europe are dragging on sentiment as investors consider the likelihood of further business shutdowns and other restrictions on business activity.
In Asia, Japan's benchmark Nikkei 225 declined 0.4%, while South Korea's Kospi recouped earlier losses, gaining 0.5%. Hong Kong's Hang Seng inched 0.1% higher.
AP Business Writer Yuri Kageyama contributed.