Major Averages Posting Modest Gains On Upbeat Earnings News
After initially showing a lack of direction, stocks have moved modestly higher over the course of the trading sessions on Tuesday. With the upward move on the day, the major averages have all reached new record intraday highs.
The major averages have pulled back off their best levels in recent trading but continue to post modest gains. The Dow is up 110.56 points or 0.3 percent at 36,024.40, the Nasdaq is up 31.55 points or 0.2 percent at 15,627.47 and the S&P 500 is up 15.01 points or 0.3 percent at 4,628.68.
The strength that has emerged on Wall Street partly reflects recent upward momentum, as traders react to another batch of upbeat earnings news.
Athletic apparel maker Under Armour (UAA) has moved sharply higher after reporting third quarter earnings that exceeded analyst estimates and raising its full-year outlook.
Shares of Pfizer (PFE) have also shown a strong move to the upside after the drugmaker reported better than expected third quarter results and raised its full-year guidance.
Chemical maker DuPont (DD) is also posting a standout gain after reporting third quarter results that exceeded expectations.
DuPont also announced an agreement to acquire materials technology company Rogers Corp. (ROG) for $5.2 billion in cash.
Overall trading activity has remained somewhat subdued, however, as traders look ahead to the Federal Reserve’s monetary policy announcement on Wednesday.
The Fed is expected to announce plans to begin gradually scaling back its $120 billion in monthly bond purchases by mid-November or December.
The language of the Fed’s statement is likely to be in focus as traders look for clues about the outlook for interest rates amid concerns about the high rate of inflation.
A lack of major U.S. economic data may also be keeping traders on the sidelines ahead of the release of the Labor Department’s closely watched monthly jobs report on Friday.
Transportation stocks continue to see substantial strength in mid-day trading, with the Dow Jones Transportation Average soaring by 5.8 percent. The average reached a new record intraday high earlier in the session.
Shares of Avis Budget (CAR) have skyrocketed after the car rental company reported better than expected third quarter results.
Significant strength also remains visible among networking stocks, as reflected by the 3.7 percent spike by the NYSE Arca Networking Index. The index has also reached a new record intraday high.
Arista Networks (ANET) has soared after the networking company reported better than expected third quarter results and provided upbeat guidance. Arista also announced a $1 billion share repurchase program and a four-for-one stock split.
Computer hardware and pharmaceutical stocks are also seeing considerable strength on the day, while steel, tobacco and oil stocks have moved to the downside.
In overseas trading, stock markets across the Asia-Pacific region moved mostly lower during trading on Tuesday. Japan’s Nikkei 225 Index fell by 0.4 percent, while China’s Shanghai Composite Index slumped by 1.1 percent.
Meanwhile, the major European markets turned in a mixed performance on the day. While the U.K.’s FTSE 100 Index edged down by 0.2 percent, the French CAC 40 Index rose by 0.5 percent and the German DAX Index advanced by 0.9 percent.
In the bond market, treasuries have moved to the upside after ending the previous session modestly lower. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is down by 4 basis points at 1.535 percent.
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