NEW YORK: Wall Street stocks rose for a second straight session on Tuesday (Oct 18) on the back of another round of generally solid earnings, with blockbuster results coming later this month.
Goldman Sachs and Johnson & Johnson were among the companies that reported better-than-expected results, while Lockheed Martin shot up nearly 9% as it confirmed its full-year profit outlook and authorised up to US$14 billion in additional share repurchases.
“The banks have given Wall Street some reasons to be optimistic,” said Oanda’s Edward Moya, before adding that companies in other sectors could dim those hopes.
“This is an impressive bear-market rally that will likely get faded as the Fed is nowhere near ready to downshift their tightening pace,” he said.
The Dow Jones Industrial Average rose 337.98 points, or 1.12%, to 30,523.8, the S&P 500 gained 42.03 points, or 1.14%, to 3,719.98 and the Nasdaq Composite added 96.60 points, or 0.9%, to 10,772.40.
“The banks were good ... we’ll see if some of the other ones, more of the consumer sensitive ones, can they pass through their cost increases, have they stopped passing them though, but yeah people are hoping for better,” said Joe Saluzzi, co-manager of trading at Themis Trading in Chatham, New Jersey.
“We need to see more of the earnings data, we need to see more of the data that will knock down inflation and then you can maybe get your rally going, until then I think everybody would say treat all rallies as suspect.”
Among individual companies, Goldman Sachs won 2.5% after reporting lower profits on a big drop in revenues tied to corporate merger advising, but still topping analyst expectations on strong trading revenues.
The solid bank earnings have given a boost to investors in what is expected to be a challenging earnings period.
Netflix lost 1.73% ahead of its earnings report after the market close, with all eyes on the video-streaming company's subscriber growth, which is seen falling in the third quarter. But its shares surged 14.49% after the closing bell as it reversed subscriber declines. – AFP, Reuters