U.S. Stocks Climb to Start a Busy Week of Earnings

Date : 10/21/2019 @ 9:10PM
Source : Dow Jones News
Stock : Boeing Co (BA)
Quote : 341.67  -4.62 (-1.33%) @ 12:47AM
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Last $ 341.60 ▼ -0.07 (-0.02%)

U.S. Stocks Climb to Start a Busy Week of Earnings

Boeing (NYSE:BA)
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By Karen Langley and Caitlin Ostroff 

U.S. stocks inched higher Monday to start a busy week of corporate earnings, while investors continued to track developments in the U.K.'s divorce from the European Union.

This is the busiest week of the quarter for corporate earnings, and results so far have beaten analysts' expectations. Those expectations were low, however, with analysts as of Sept. 30 estimating a 4% decline in third-quarter earnings for S&P 500 companies, according to FactSet.

Shares of oil-field services company Halliburton added 6.4% Monday after reporting cost cuts and a better-than-expected outlook. Even with the rally, the stock is down 26% year-to-date.

"So far we've seen the out-of-favor stocks react positively to earnings, " said Olivier Sarfati, head of equities at GenTrust. "But we haven't seen the in-favor stocks that everybody else owns because they haven't reported yet."

Among the companies scheduled to report later this week are Microsoft, Amazon and Twitter.

The S&P 500 climbed 20.52 points, or 0.7%, to 3006.72, with nine of 11 sectors rising. Only the materials and health-care segments ended in the session in the red. The technology-laden Nasdaq Composite gained 73.44 points, or 0.9%, to 8162.99.

The Dow Jones Industrial Average edged up 57.44 points, or 0.2%, to 26827.64, weighed down by a decline in the shares of Boeing after the Wall Street Journal reported that Congress was intensifying scrutiny of the plane maker.

All three major indexes are within about 2% of their July record highs.

Investors are also looking ahead to the Federal Reserve's meeting later this month, when the central bank is expected to lower interest rates again, after two recent rate cuts.

Sentiment has risen in recent days, helped by a "phase one" trade deal between the U.S. and China that prevented additional tariffs from taking effect. Trade officials from the two countries were to continue discussing a partial deal that could be signed by President Trump and Chinese President Xi Jinping.

"The pieces are falling into place for an upturn in global growth," said Joe Quinlan, head of CIO Market Strategy for Merrill and Bank of America Private Bank. "This is exactly what equities are suggesting."

In other corporate news, Boeing shares fell 3.8% -- weighing on the Dow -- after The Wall Street Journal reported that Congress is ramping up scrutiny of the plane maker's leaders as new details pointed to undue management pressure on employees.

Shares of drug companies AmerisourceBergen, Cardinal Health and McKesson fell after the Journal reported the companies reached a last-minute settlement, avoiding a trial seeking to blame them for fueling the opioid crisis. AmerisourceBergen fell 3.3%, Cardinal Health dropped 2.2% and McKesson lost 3.2%.

Cosmetics maker Coty shares rallied 13% after the company said it would explore strategic alternatives for its professional beauty business.

The yield on the 10-year U.S. Treasury rose to 1.794% from 1.747% Friday. Bond yields rise as prices fall.

In the U.K., the British pound posted small loses and gains against the dollar, briefly climbing past the psychological barrier of $1.30, after a critical vote on Prime Minister Boris Johnson's Brexit deal was delayed.

"We're going to have that kind of ebbing and flowing," said David Madden, market analyst at CMC Markets. "It's just going to be hanging around to find out what's happening."

The U.K.'s FTSE 100, which includes many companies with large overseas earnings that benefit from sterling's decline, edged up 0.2%. The pan-continental Stoxx Europe 600 index rose 0.6%.

Write to Caitlin Ostroff at caitlin.ostroff@wsj.com

 

(END) Dow Jones Newswires

October 21, 2019 16:55 ET (20:55 GMT)

Copyright (c) 2019 Dow Jones & Company, Inc.

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