Wall St. rallies over 2 percent with earnings, data boost
By Lewis Krauskopf NEW YORK (Reuters) - U.S. stocks surged more than 2 percent on Tuesday after upbeat earnings reports from major companies including UnitedHealth and Goldman Sachs and solid economic data, as equities rebounded from a recent sharp sell-off
By Lewis Krauskopf
NEW YORK (Reuters) - U.S. stocks surged more than 2 percent on Tuesday after upbeat earnings reports from major companies including UnitedHealth and Goldman Sachs and solid economic data, as equities rebounded from a recent sharp sell-off.
Wall Street's three major indexes tallied their biggest one-day percentage gains since March. The small-cap Russell 2000 recorded its biggest single-session gain in nearly two years.
Technology, which sold off heavily in the recent pullback, led the gains as all 11 major sectors were positive.
Investors are expecting another strong quarter of corporate profits, hoping the reports can calm nerves following concerns over global trade tensions and rising bond yields. Third-quarter earnings for S&P 500 companies are expected to have climbed 21.8 percent, according to I/B/E/S data from Refinitiv.
“The corporate profits have certainly been the biggest prop for this market, and so a lot of weight is going to be given to how those corporate profits come out," said Chuck Carlson, chief executive officer at Horizon Investment Services in Hammond, Indiana. "We are early in the season, but so far so good, especially today."
The gains marked a partial recovery from Wall Street's recent steep pullback from record levels. The S&P 500 last week posted its biggest weekly drop since March, and some market-watchers said it was not clear that the recent volatility was over.
"It’s mostly an oversold bounce," Willie Delwiche, investment strategist at Baird in Milwaukee, said of Tuesday's gains.
"The degree of the move is a function of the moves we have seen already this month more than anything else."
The Dow Jones Industrial Average rose 547.87 points, or 2.17 percent, to 25,798.42, the S&P 500 gained 59.13 points, or 2.15 percent, to 2,809.92 and the Nasdaq Composite added 214.75 points, or 2.89 percent, to 7,645.49.
The technology sector gained 3.0 percent while healthcare rose 2.9 percent. Those two groups have led the S&P 500's advance this year.
Goldman Sachs and Morgan Stanley reported better-than-expected quarterly profits, helped by strength in stock trading and equity underwriting, wrapping up a strong quarter for the big U.S. banks. Goldman shares rose 3.0 percent, while Morgan Stanley shares gained 5.7 percent.
In healthcare, shares of diversified product company Johnson & Johnson rose 1.9 percent, while insurer UnitedHealth Group gained 4.7 percent following their respective quarterly reports.
Adobe shares jumped 9.5 percent following the software company's analyst meeting, adding to the day's upbeat sentiment for tech.
Walmart shares rose 2.1 percent as its chief executive urged investors to revise their view of the company's business.
After the market closed, shares of Netflix, one of the closely watched group of FANG momentum stocks, jumped following the streaming video company's report.
On the downside, BlackRock shares dropped 4.4 percent after the world's biggest asset manager reported its lowest sales of equity, bond and other long-term investments since the second quarter of 2016.
Shares of industrial distributor W W Grainger tumbled 11.9 percent after its report.
In economic data, U.S. industrial production increased for a fourth straight month in September, boosted by gains in manufacturing and mining output, while other data showed job openings hit a record high in August.
About 7.5 billion shares changed hands in U.S. exchanges. That was below the 7.9 billion daily average over the last 20 sessions, and well lower than busier trading days last week when the market was sliding.
Advancing issues outnumbered declining ones on the NYSE by a 5.17-to-1 ratio; on Nasdaq, a 4.02-to-1 ratio favoured advancers.
The S&P 500 posted five new 52-week highs and seven new lows; the Nasdaq Composite recorded 17 new highs and 76 new lows.
(Additional reporting by Medha Singh in Bengaluru; Editing by Nick Zieminski and James Dalgleish)
This story has not been edited by Firstpost staff and is generated by auto-feed.
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