By Chuck Mikolajczak
| NEW YORK
NEW YORK Wall Street advanced on Tuesday to give the S&P 500 its best day this month on the heels of solid earnings reports from names such as UnitedHealth and Netflix that put corporate profits on track to snap a four-quarter streak of declines.Of the 52 S&P 500 companies that have reported results to date for the third quarter, 81 percent have reported earnings that topped average analyst estimates, according to Thomson Reuters I/B/E/S.Third-quarter earnings are now expected to show growth of 0.2 percent, which would mark an end to the U.S. profit recession that began in the third quarter of 2015. If the quarter stays on track, it will be the first time since the fourth-quarter of 2014 in which both earnings and revenue of S&P 500 companies increased."We had some decent earnings results," said Jack Ablin, chief investment officer at BMO Private Bank in Chicago. "Given companies' track record of beating expectations, investors believe this will be the first quarter in five where we have positive earnings growth."
The Dow Jones industrial average .DJI rose 75.54 points, or 0.42 percent, to 18,161.94, the S&P 500 .SPX gained 13.1 points, or 0.62 percent, to 2,139.6 and the Nasdaq Composite .IXIC added 44.01 points, or 0.85 percent, to 5,243.84.Gains were broad, with each of the 11 major S&P sectors in positive territory, led by a 1.1 percent gain in healthcare .SPXHC, boosted by a UnitedHealth's (UNH.N) 6.9 percent jump after quarterly results and forecast.Gains in the sector were curbed by a 2.6-percent decline in Johnson & Johnson (JNJ.N), while Pfizer (PFE.N) gained 0.6 percent on plans to ship a cheaper biosimilar to Remicade, JNJ's top selling product. The news overshadowed J&J's slight earnings beat.Netflix (NFLX.O) was the biggest advancer on the S&P 500, rising more than 19 percent after posting quarterly results and much higher-than-expected subscriber growth.
Goldman Sachs (GS.N) rose 2.2 percent after the bank's results blew past Wall Street estimates, mirroring the performance of its Wall Street peers and helping lift the NYSE Arca Broker/Dealers index .XBD 1.1 percent.Among the decliners, IBM (IBM.N), fell 2.6 percent after reporting its 18th straight quarter of revenue decline. Intel (INTC.O), rose 1.5 percent during the session on a Barclays upgrade, but shares fell 3.3 percent after the close following the chipmaker's results.
Advancing issues outnumbered declining ones on the NYSE by a 3.24-to-1 ratio; on Nasdaq, a 1.81-to-1 ratio favoured advancers.The S&P 500 posted 4 new 52-week highs and 3 new lows; the Nasdaq Composite recorded 47 new highs and 60 new lows. About 5.6 billion shares changed hands in U.S. exchanges, below the 6.52 billion daily average over the last 20 sessions. (Reporting by Chuck Mikolajczak; Editing by Nick Zieminski)
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First Published On : Oct 19, 2016 02:15 IST