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Wall St. inches up with financials; earnings in focus
October 16, 2017 / 11:19 AM / 2 months ago

Wall St. inches up with financials; earnings in focus

NEW YORK (Reuters) - All three major U.S. stock index rose to record closing highs on Monday, with the Dow Jones Industrial Average less than 50 points below 23,000, ahead of a long list of earnings this week and as financial shares recovered from last week’s losses.

JPMorgan Chase (JPM.N) and Bank of America (BAC.N) led gains in bank stocks, tracking a climb in U.S. Treasury yields, which benefits banks. JPMorgan was up 2.1 percent, while Bank of America was up 1.6 percent.

The S&P 500 financial index .SPSY rose 0.6 percent after three days of losses. Shares of banks mostly slipped last week after they reported results.

Netflix (NFLX.O) gained 1.6 percent during the session and rose another 2 percent after the bell following the release of its results. Apple (AAPL.O) shares gained 1.8 percent following a bullish brokerage call on the iPhone maker.

The reporting period heats up this week, and with the S&P 500 already up 14 percent so far this year, investors are hoping results and guidance will justify the relatively high valuation of stocks.

“Big companies are going to start reporting earnings, and I think that’s going to drive the direction of the market for the next two or three weeks. There’s a lot of optimism built in, and hopefully it will be reflected in the earnings,” said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia.

“You saw decent numbers from the banks but quirks here and there. But for the bigger tech companies, people have high hopes.”

Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., October 13, 2017. REUTERS/Brendan McDermid

The Dow Jones Industrial Average .DJI rose 85.24 points, or 0.37 percent, to close at 22,956.96, the S&P 500 .SPX gained 4.47 points, or 0.18 percent, to 2,557.64 and the Nasdaq Composite .IXIC added 18.20 points, or 0.28 percent, to 6,624.01.

All three hit record closing highs, adding to recent records.

Investors will keep a close eye on the Senate, which is trying this week to pass a partisan budget blueprint that would help guide federal spending.

The Republicans want to use the “budget resolution” to pave the way for the party later this year or next year to pass a major tax-cut bill without any Democratic support.

U.S. President Donald Trump said Republicans and Democrats in Congress are working on a short-term fix for healthcare insurance markets after he last week scrapped subsidies to insurers.

S&P healthcare stocks .SPXHC were among the biggest laggards, with the index falling 0.4 percent.

Declining issues outnumbered advancing ones on the NYSE by a 1.02-to-1 ratio; on Nasdaq, a 1.10-to-1 ratio favored decliners.

About 5.5 billion shares changed hands on U.S. exchanges. That compares with the 5.9 billion daily average for the past 20 trading days, according to Thomson Reuters data.

Editing by Nick Zieminski and James Dalgleish

Our Standards:The Thomson Reuters Trust Principles.
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