Stimulus bets drive Wall Street higher

By Medha Singh and Shivani Kumaresan (Reuters) - Wall Street's main indexes climbed on Tuesday on growing signs that U.S.

Reuters October 21, 2020 00:05:09 IST
Stimulus bets drive Wall Street higher

Stimulus bets drive Wall Street higher

By Medha Singh and Shivani Kumaresan

(Reuters) - Wall Street's main indexes climbed on Tuesday on growing signs that U.S. lawmakers were making headway in their talks over stimulus to support an economic recovery from the impact of the COVID-19 pandemic.

House of Representatives Speaker Nancy Pelosi said she was optimistic Democrats could reach a deal with the White House that could get aid out by early next month. She added there should be an indication of a possible agreement later on Tuesday.

Pelosi and Treasury Secretary Steven Mnuchin will also talk at 3 p.m. ET (1900 GMT) on Tuesday, according to a source.

"Visibly there is optimism that the stimulus deal is going to be done at the end of the day," said Matthew Stucky, portfolio manager, equities at Northwestern Mutual Wealth Management Co.

Uncertainty over the coronavirus aid package weighed on Wall Street's main indexes on Monday and analysts expect market turbulence to increase with only two weeks left until Election Day.

Latest national opinion polls pointed to a victory for Democratic challenger Joe Biden, though the contest is closer in swing states that decide elections including Florida, North Carolina and Pennsylvania.

Meanwhile, the third-quarter earnings season has gathered momentum. Of the 66 S&P 500 companies that have reported results, 86.4% have topped expectations for earnings, according to Refinitiv IBES data.

Property and casualty insurer Travelers Cos Inc gained 5.2% as it beat quarterly profit expectations, while consumer products giant Procter & Gamble Co advanced 0.7% as it raised its full-year sales and earnings forecasts.

All 11 major S&P sectors were up, with financials, industrials and consumer discretionary stocks rising over 1%.

At 12:46 p.m. ET, the Dow Jones Industrial Average was up 249.70 points, or 0.89%, at 28,445.12 and the S&P 500 was up 33.38 points, or 0.97%, at 3,460.30. The Nasdaq Composite was up 98.53 points, or 0.86%, at 11,577.41.

Netflix Inc dipped 0.5% ahead of its third-quarter earnings report.

International Business Machines Corp edged past estimates for quarterly revenue on Monday, bolstered by higher demand for its cloud services. The company's shares, however, fell 5.9% after it stayed away from issuing a current-quarter outlook, citing economic uncertainty related to the pandemic.

The U.S. Justice Department and 11 states filed an antitrust lawsuit against Alphabet Inc's Google for allegedly breaking the law in using its market power to fend off rivals. Alphabet's shares were up 0.8%.

Advancing issues outnumbered decliners for a 3.36-to-1 ratio on the NYSE and a 1.57-to-1 ratio on the Nasdaq.

The S&P index recorded 15 new 52-week highs and one new low, while the Nasdaq recorded 57 new highs and 22 new lows.

(Reporting by Medha Singh and Shivani Kumaresan in Bengaluru; Editing by Shounak Dasgupta)

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