Wall Street progressed on Tuesday as third-quarter reporting season hit with a spate of upbeat earnings reports that introduced consumers back to the equities market.
All three main U.S. stock averages gained ground in a broad-based rally, with the S&P 500 and the Nasdaq hitting their highest closing level in more than three weeks.
“Positive earnings are flowing via equity markets at present, suggesting that things weren’t as bad as buyers thought,” mentioned Charlie Ripley, senior market strategist for Allianz Investment Management in Minneapolis.
“We have been in a headline-driven market over the past few months,” Ripley added. “However, we’ve had progress recently, which has allowed buyers to modify their focus to more elementary things like earnings and upcoming financial information.”
Adding to positive geopolitical developments, investors welcomed the information that Britain and the European Union may attain a deal in time for a leaders’ summit this week.
Leading financial companies JPMorgan Chase & Co, Citigroup Inc, Goldman Sachs Group Inc, and Wells Fargo & Co (WFC.N) all posted outcomes, as did healthcare giants Johnson & Johnson (JNJ.N) and UnitedHealth Group Inc (UNH.N).
Among the many large banks, JPMorgan Chase stock hit a record high after it handily beat estimates on bond trading and underwriting power. Its shares were last up 3.0%.
Citigroup rose 1.4% following its revenue beat.
Wells Fargo’s outcomes had been much less upbeat, as its revenue slid 26% because of sinking mortgage income and authorized prices. Goldman Sachs’ benefit miss was attributed to weak underwriting. Nonetheless, Wells Fargo rose 1.7%, whereas Goldman edged up 0.3%.
Prescription drug sales assisted drive Johnson & Johnson’s upside surprise, whereas UnitedHealth raised its 2019 steering on pharmacy profit growth. Their shares restrained 1.6% and 8.2%, respectively.
Analysts presently anticipate S&P 500 third-quarter earnings to have contracted by 3% from last year, down from the 12.1% progress seen a year in the past, according to Refinitiv data.