U.S. stocks closed higher Tuesday, fighting through an early rise in Treasury bond yields, as a host of solid corporate earnings, and expectations for outperformance in the megacap tech sector, and a stronger-than-expected reading for consumer confidence boosted investor sentiment.
The S&P 500 close 9.4 points, or 0.16% on the session, reversing an earlier decline, with the help of gains for Nvidia, Apple and Microsoft. The Nasdaq, meanwhile, ended 145 points, or 0.78% higher for another record close.
The Dow, however, slipped 154 points amid declines for McDonald's, UnitedHealth (UNH) and Merck (MRK) .
S&P 500 Closing Bell Heatmap (Oct. 29, 2024)$SPY +0.17%🟩$QQQ +0.78%🟩$DJI -0.36%🟥$IWM -0.27%🟥 https://t.co/njRLbmh2n4 pic.twitter.com/yqkNmxfQbx
— Wall St Engine (@wallstengine) October 29, 2024
Updated at 3:39 PM EDT
Late gains
Stocks are moving higher into the close, with the S&P 500 up 22 points, or 0.35% and the Nasdaq rising 180 points, or 0.97%, even as Treasury yield pared some of their earlier advance following a solid auction of 7-year notes.
Benchmark 10-year notes were last marked at 4.276%, down nearly 8 basis points from their early-session high, with 2-year paper trading at 4.127%
Our grade for today's US Treasury 7-Year Note Auction: B-
— yieldcurvepro (@yieldcurvepro) October 29, 2024
- Date 2024-09-26
- CUSIP 91282CLM1
- BTC 2.63
- Avg 3.608%
- Hi 3.668%
- Total $44B
Systematic Approach To Grading US Treasury Auctions 👉 https://t.co/3WpwH5B1W7 pic.twitter.com/7t15hr8wrZ
Updated at 1:03 PM EDT
Broadcom AI boom
Broadcom (AVGO) shares were moving higher in volume following a Reuters report that the tech giant is developing an AI chip with ChatGTP creator OpenAI.
Reuters also said that OpenAI, now valued at an estimated $157 billion, is using Nvidia (NVDA) and Advanced Micro Devices (AMD) chips as it expands its reach and attempts to take on rivals such as Elon Musk's XAI and chatbot systems developed by Google and Meta Platforms (META) .
Broadcom shares were last marked 3.3% higher in early afternoon trading and changing hands at $177.67 each.
$AVGO
— semi (@johnwayne12591) October 29, 2024
Broadcom and OpenAI developing AI inference chip pic.twitter.com/HfRf4eDK3V
Updated at 10:47 AM EDT
Mild JOLT
The Atlanta Fed's next-to-last update for its third quarter GDP growth forecast was trimmed to 2.8% this morning, from its prior estimate of 3.3% from last week.
The final update is expected on Thursday, a day after the Commerce's Department's first official estimate, which is slated for tomorrow morning at 8:30 am Eastern time.
Atl Fed GDPNow down to 2.8%https://t.co/W0QPjCVSvw pic.twitter.com/r96w1Wy7yV
— Mike Zaccardi, CFA, CMT 🍖 (@MikeZaccardi) October 29, 2024
Updated at 10:33 AM EDT
Mild JOLT
The job market showed some early autumn weakness, based on the September job openings and labor turnover report from the Commerce Department, as the number of open positions fell by around 420,000 to 7.44 million.
The so-called quits rate, which can be seen as a proxy for wage inflation (as workers leave one job to find another that pays more) slipped to 1.9% while layoffs rose by 165,000 from the previous month to 1.833 million.
"Decreasing or subdued job openings, quits and hiring rates last month all point to a cooler labor market compared to one year ago," said Elizabeth Renter, senior economist at NerdWallet. "Employers aren’t bringing many folks on and workers aren’t super eager to leave the comforts of their existing roles in the current environment."
The latest JOLTS data dropped -418k MoM to 7,443k and -1,864k YoY (-367k change). The job openings per unemployed declined -0.016% to 1.089%. The "Quits" rate dropped again declining -0.1% to 1.9%.
— Macro84 (@macro84) October 29, 2024
JOLTS data points to a labor market in transition and one that is cooling, with… pic.twitter.com/TDJAhPUzAn
Updated at 9:35 AM EDT
Down day?
The S&P 500 was marked 15 points, or 0.25%, lower in the opening minutes of trading, with the Nasdaq down 51 points, or 0.28%.
The Dow, meanwhile, was marked 121 points lower, with the midcap Russell 2000 falling 19 points, or 0.32%.
S&P 500 Opening Bell Heatmap (Oct. 29, 2024)$SPY -0.32%🟥$QQQ -0.23%🟥$DJI -0.29%🟥$IWM -1.04%🟥 pic.twitter.com/iCoZnexcYC
— Wall St Engine (@wallstengine) October 29, 2024
Updated at 9:16 AM EDT
It's the inflation, stupid!
Treasury yields are back on the move, with 10-year note yields rising to 4.331% and 2-year notes pegged at 4.168% amid heightened concern that inflation might resurge in the event of a Trump victory next week.
Stocks reacted to the early move higher in yields, with the S&P 500 now called 8 points lower and the Dow looking at a 151 point pullback. The Nasdaq, however, is called 8 points higher
Deficit Threat Drives Bond Yields Higher - WSJ
— Open Outcrier (@OpenOutcrier) October 29, 2024
Investors expect Trump would increase budget gap with tax cutshttps://t.co/MogXGGVqEo
Updated at 7:08 AM EDT
Not Lovin' It
McDonald's shares slipped in premarket trading after the world's biggest restaurant chain posted a decline in global sales that clouded a firmer-than-expected third quarter earnings report.
McDonald's, which is scrambling to contain an E.coli outbreak in its home market, said global sales fell 1.5% from a year earlier, the biggest decline since the pandemic, with only a modest 0.3% gain in the United States tied in part to the extension of its $5 Value Meal.
McDonald's shares were marked 0.6% lower in premarket trading to indicate an opening bell price of $295.01 each.
$MCD Earnings:
— AlphaSense (@AlphaSenseInc) October 29, 2024
- Diluted earnings per share was $3.13, a decrease of 1% (1% in constant currencies). Excluding the current year charges described above of $0.10 per share, diluted earnings per share was $3.23, an increase of 1% (1% in constant currencies) when also excluding… pic.twitter.com/gF7uf2W0Jq
Updated at 6:53 AM EDT
Pfizer booster
Pfizer share jumped higher in early trading after the pharma giant, which is being pressured by activist investors, posted stronger-than-expected third quarter earnings and boosted its full-year profit forecast.
Pfizer said it saw full-year earnings in the region of $2.75 to $2.95 per share, a 30-cent improvement from its prior forecast. The company expects its ongoing cost-cutting program to deliver at least $4 billion in savings.
Pfizer shares were marked 2.9% higher in premarket trading to indicate an opening bell price of $29.78 each.
Stock Market Today
Stocks ended higher on Monday, with the S&P 500 rising around 0.27% into the close of trading even as benchmark bonds extended their long autumn selloff following a poorly received auctions new 2-year notes and 5-year notes.
The sales, which showed a big slump in foreign buyers, echo the recent so-called Trump trade in certain financial market sectors, including the Treasury bond market, where the influence of the former president, should he win next week's election, is most likely to be felt.
Investors see Trump's policies of tax cuts, tariffs and large-scale deportations as inflationary, with little chance of being offset by plans to increase energy production.
Trump, while leading in online betting markets, remains deadlocked with Vice President Kamala Harris in several battleground states heading into next Tuesday's vote.
Related: Stocks eye 'Trump Trade' as Treasury yields climb in deadlocked election
Benchmark 2-year note yields were last marked at 4.152%, the highest since early August, while 10-year notes were trading at an early July peak of 4.308% heading into the start of the New York session. The first of a series of labor market data releases, the September Jolts report, is due at 10 a.m. Eastern time.
That's having a muting effect on stocks, which are set to open only marginally higher ahead of a busy slate of premarket earnings, including McDonald's (MCD) , Pfizer (PFE) and PayPal (PYPL) .
Google parent Alphabet (GOOGL) kicks off a three-day stretch of five Magnificent 7 earnings reports after the closing bell.
Analysts expect the group to post a bottom line of $1.85 per share, up nearly 20% from a year earlier, on revenue of around $86.3 billion.
Related: Mag 7 earnings this week are pivotal as AI hype fades
Heading into the start of the trading day, futures contracts tied to the S&P 500 suggest a modest 4 point opening bell gain, while those linked to the Dow Jones Industrial Average are priced for a 20 point bump.
The tech-focused Nasdaq, meanwhile, is called 30 points higher with Nvidia (NVDA) , MicroStrategy (MSTR) and Trump Media & Technology (DJT) shares active in premarket trading.
Ford Motor F shares were also a notable early mover, falling more than 6% to $10.68 each after the carmaker trimmed its full-year profit forecast, thanks in part to ongoing losses in its EV division, following a mixed set of third quarter earnings.
More Wall Street Analysts:
- Analysts update Meta stock price target with Q3 earnings in focus
- Analysts update outlook for Nvidia's Blackwell chips amid AI boom
- Analyst reboots Reddit stock price target ahead of earnings
In overseas markets, Europe's Stoxx 600 was marked 0.25% higher in early Frankfurt trading, scaling the highest levels in a week, following on from last night's close on Wall Street and another slate of solid corporate earnings.
Britain's FTSE 100 rose 0.41% in London even as oil major BP slumped 2.4% following its weakest quarterly profit in nearly four years.
Overnight in Asia, Japan's Nikkei 225 extended yesterday's rally with a 0.77% gain as the fallout from Sunday's national elections continues, pulling the yen near to a multimonth low of 153.34 against the U.S. dollar.
Related: Veteran fund manager sees world of pain coming for stocks
