US Stocks Higher on Solid Earnings 10/15 11:16
Stocks marched higher in morning trading on Wall Street Tuesday after some
of the nation's largest companies reported surprisingly good financial results.
NEW YORK (AP) -- Stocks marched higher in morning trading on Wall Street
Tuesday after some of the nation's largest companies reported surprisingly good
The earnings reports from a mix of health care and financial companies gave
the market direction after a wobbly Monday as investors weighed the impact of a
truce in the U.S.-China trade war. The latest round of corporate earnings will
give them a clearer picture of that long-running dispute's impact on the
broader economy and various industries.
Health care stocks led the market as insurer UnitedHealth Group and health
care products company Johnson & Johnson raised their annual financial forecasts
following third-quarter results that beat Wall Street expectations.
Chipmaker Nvidia rose 4.7% and led technology stocks higher.
Solid financial results from JPMorgan Chase and Charles Schwab helped push
financial stocks higher.
Bond prices fell. The yield on the 10-year Treasury rose to 1.75% from 1.73%
late Friday. Bond markets were closed Monday for Columbus Day.
Utilities, real estate companies and makers of consumer goods all fell as
investors regained an appetite for more risk. The sectors are considered
safe-play holdings and usually lag the market when investors are more confident.
Tuesday marks the beginning of a busy few days for corporate earnings.
United Airlines Holdings will report later in the day and give investors an
early glimpse into the health of the airline industry.
Banks continue their earnings reports on Wednesday with Bank of America and
PNC Financial. Railroad giant CSX, Netflix and IBM will also report results on
KEEPING SCORE: The S&P 500 index rose 1.1% as of 11:15 a.m. Eastern time.
The Dow Jones Industrial Average rose 271 points, or 1%, to 27,054. The Nasdaq
OVERSEAS: European markets rose. The European Union said that a deal with
Britain is still possible ahead of their expected separation on Oct. 31. The
trading bloc said that Britain needs to move ahead with more compromises to
seal an agreement.
Markets in Asia were mixed.
EARNINGS WORRIES: The early batch of upbeat financial reports come amid
broader concerns for another rough round of quarterly earnings reports as a
wide range of industries absorb the impact of ongoing trade disputes and
growing economic uncertainty. Corporate earnings are expected to contract by
nearly 5% during the third quarter, according to FactSet.
The dire prediction could soften as more companies report earnings. Similar
forecasts were made ahead of both the first and second quarter reporting
periods and companies in the S&P 500 managed to deliver only a modest
contraction each time.
Once again, analysts and investors will be listening closely to company
forecasts for the rest of the year to gauge the economic impact of the
U.S.-China trade war and other issues that could crimp economic growth.
HEALTHY FORECASTS: UnitedHealth Group rose 8.3% after it hiked its 2019
profit forecast. The nation's largest health insurance company said the
addition of hundreds of clinics to its health care services business helped
drive revenue and profit during the third quarter, both of which beat Wall
Johnson & Johnson, the world's biggest maker of health care products, rose
1.8% after it also raised its profit forecast for the year following solid
third quarter results. The company cited higher sales of key medicines for
cancer and immune disorders.
BANKS AT BAT: JPMorgan Chase rose 3.8% after the bank beat Wall Street's
third quarter profit forecasts on growth from higher interest rates and solid
performance from its investment banking business.
Other major banks reported mixed results.
Goldman Sachs fell 1.5% after reporting a dive in third quarter profits on
losses from some of its public investments and as it struggled to drum up
Citigroup rose 1.9% while Wells Fargo rose 1.3%.