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Dow spikes 534 points as earnings season opens with a series of strong performances

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Lucas Jackson/Reuters

  • US stocks soared nearly 2% on Thursday as third-quarter earnings season started off strong.
  • Earnings reports from banks including Bank of America, Morgan Stanley, and Citigroup were ahead of expectations.
  • Weekly jobless claims fell to a pandemic-era low, also helping boost investor sentiment.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

US stocks jumped nearly 2% on Thursday as investors reacted positively to strong third-quarter earnings beats from banks including Bank of America, Morgan Stanley, and Citigroup.

The bank stocks soared as much a 4% as a continued drop in provisions for credit losses and strength in the investment banking and wealth management sectors drove growth.

Also boosting investor sentiments on Thursday was a strong weekly jobless claim reading of 293,000, representing a pandemic-era low and beating economist estimates. Continuing claims fell to 2.59 million, besting forecasts as well.

The Dow Jones Industrial Average jumped over 500 points while the tech-heavy Nasdaq 100 led markets higher.

Here’s where US indexes stood at the 4:00 p.m. ET close on Thursday:

Cathie Wood’s Ark Invest put its name behind a bitcoin futures ETF that was filed with the SEC on Wednesday, signalling that the futures-based crypto ETF may be eventually approved by the regulatory agency.

Coding platform GitHub soared more than 20% in its IPO debut on Thursday, sporting a valuation of more than $11 billion. The company, which has seen a surge in growth amid the work-from-home trend, priced its IPO at $77 per share.

Chinese brokerage firms fell sharply in Thursday trades as it became apparent that a new data privacy law in China will likely hamper the companies’ ability to service mainland China investors unless they quickly adapt to the new rules.

Citigroup saw its profits surge 48% in the third-quarter following the release of loss reserves and a strong period for equity and fixed income trading.

Bank of America beat its earning estimates for the third-quarter, as record-high advisory fees and a $1.1 billion reserve release helped boost profits.

Morgan Stanley posted a strong third-quarter earnings report as growth in its investment banking and wealth management divisions bested estimates.

West Texas Intermediate crude oil rose as much as 1.16%, to $81.37 per barrel. Brent crude, oil’s international benchmark, jumped 1.14%, to $84.13 per barrel.

Gold jumped as much as 0.23%, to $1,798.80 per ounce.

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Dow soars 403 points as jobless claims hit pandemic low and banks deliver strong results

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Xinhua/Wang Ying/ Getty Images

US stocks surged on Thursday after weekly jobless claims hit a pandemic-era low and third-quarter earnings results from banks beat expectations. The Dow Jones Industrial Average jumped by about 400 points.

Last week’s jobless claims hits 293,000, representing the lowest level since March 2020 and beating economist expectations of 319,000. Continuing claims fell to 2.59 million, besting forecasts as well.

Strong bank earnings results from Morgan Stanley, Bank of America, and Citigroup beat analyst expectations and suggested consumers remain on solid footing as provisions for credit losses continued to fall from their pandemic heights. The banks were trading higher by about 2% early Thursday.

Here’s where US indexes stood shortly after the 9:30 a.m. ET open on Thursday:

Cathie Wood’s Ark Invest put its name behind a bitcoin futures ETF that was filed with the SEC on Wednesday, signalling that the futures-based crypto ETF may be eventually approved by the regulatory agency.

Citigroup saw its profits surge 48% in the third-quarter following the release of loss reserves and a strong period for equity and fixed income trading.

Bank of America beat its earning estimates for the third-quarter, as record-high advisory fees and a $1.1 billion reserve release helped boost profits.

Morgan Stanley posted a strong third-quarter earnings report as growth in its investment banking and wealth management divisions bested estimates.

West Texas Intermediate crude oil rose as much as 0.92%, to $81.18 per barrel. Brent crude, oil’s international benchmark, jumped 1.13%, to $84.12 per barrel.

Gold jumped as much as 0.23%, to $1,798.80 per ounce.

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US stocks edge higher as inflation data shows prices continued to surge in September

A trader works on the trading floor at the New York Stock Exchange (NYSE) at the opening of the market in New York City, U.S., August 26, 2019.

REUTERS/Andrew Kelly

US stocks were higher on Wednesday after inflation continued to rise in September amid continued supply chain bottlenecks.

The Consumer Price Index – a commonly used measure of US inflation – rose 0.4% last month, exceeding the median forecast of a 0.3% gain from economists surveyed by Bloomberg. The print shows price growth unexpectedly picking up from the 0.3% jump seen through August.

While the Delta variant began to subside in late September, supply bottlenecks are still plaguing businesses and consumers.

Here’s where US indexes stood at the 9:30 a.m. ET open on Wednesday:

The prospect of hot inflation alongside stalled economic growth has weighed on markets, and a surge in energy prices fueled concerns that higher inflation may be less transitory than the Federal Reserve is predicting, said Nancy Davis, founder of Quadratic Capital Management and portfolio manager of an exchange-traded fund.

“If the recent pace of elevated inflation continues, that could push the Federal Reserve to start removing accommodation sooner rather than later, which could hurt stocks and other risk assets,” she said in a note Wednesday.

How inflation will affect the economy still recovering from the depths of a pandemic recession remains center stage for many economists and analysts. Fed officials have been hinting that the central bank appears on track to fully taper off assets purchases by the middle of 2022.

“Wednesday’s Consumer Price Index coincides with the start of third-quarter earnings season, and investors will be looking to see if inflation is starting to negatively affect corporate profits in a significant way,” Davis said.

JPMorgan Chase reported earnings Wednesday. The largest US bank reported third-quarter earnings that beat analyst expectations, driven by a strong performance in its investment banking division.

In cryptocurrencies, Binance will end the use of the Chinese yuan on its peer-to-peer platform. The company, which is one of the world’s largest exchanges, is set to discontinue support for the Chinese currency on December 31 this year, it said in a statement Wednesday.

Oil prices slipped. West Texas Intermediate crude slipped 0.67% to $80.12 per barrel. Brent oil, the international benchmark, turned lower, down 0.74% to $82.80.

Gold rose 0.89% to $1,776.08 per ounce.

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US stocks fall as investors receive inflation warnings from the IMF and the Fed

A trader sits in front of a computer monitor on the floor of the New York Stock Exchange.
Trader Leon Montana works on the floor of the New York Stock Exchange.

AP Photo/Richard Drew

  • US stocks closed lower Tuesday, a third consecutive loss for Wall Street’s major benchmarks.
  • Stocks turned lower as the inflation warnings came from the IMF and a New York Fed survey.
  • Atlanta Fed President Raphael Bostic said “elevated inflation is episodic,” and tied largely to the pandemic.

US stocks closed lower Tuesday after a wave of inflation warnings washed away earlier gains, highlighting a potential risk to global growth as investors prepared to enter third-quarter earnings season.

All three of Wall Street’s major benchmarks swung into the red, stretching losses for the S&P 500, the Nasdaq Composite, and the Dow industrials into a third consecutive session.

Stocks pulled back as investors assessed caution about inflation from the International Monetary Fund and the Federal Reserve itself. The Survey of Consumer Expectations released by the Federal Reserve Bank of New York showed that short- and medium-term inflation expectations have increased. Expectations for three years ahead rose to 4.2% in September, the highest rate since the survey started in 2013.

Here’s where US indexes stood at 4:00 p.m. on Tuesday:

The International Monetary Fund early Tuesday said inflation has “increased markedly” in US and in some emerging market economies. “Although price pressures are expected to subside in most countries in 2022, inflation prospects are highly uncertain,” it said. The group trimmed its 2021 global growth forecast to 5.9% from 6% as advanced economies grapple in part with supply disruption.

Raphael Bostic, president of the Federal Reserve Bank of Atlanta, said elevated inflation rates may persist. Bostic is a voting member this year on the Fed’s rate-setting board, the Federal Open Market Committee.

“I continue to believe currently elevated inflation is episodic, driven by pandemic conditions such as disruptions in supply chains and labor markets. A major caveat, though, is that the severe and pervasive supply chain issues will probably last longer than most of us initially expected,” said Bostic in a virtual speech addressing the Peterson Institute for International Economics.

Fed Vice Chair Richard Clarida, meanwhile, said Tuesday he continues to see inflation pressures as largely transitory and that the Fed appears on track to complete tapering of assets purchases by the middle of 2022.

“Dr. Doom” economist Nouriel Roubini told Bloomberg on Tuesday the Fed may start reducing its monthly asset purchases from $120 billion in November but could “wimp out”, or pause, the plan if economic growth slows and investors respond with a sharp selloff in markets as they did in 2018.

Investors will see the kickoff of the third-quarter earnings season Wednesday with JPMorgan & Chase’s report among those on the docket. Bank of America has called the upcoming earnings season a “make or break” one for investors as companies have already flagged issues surrounding supply chain bottlenecks and rising labor costs.

Around the markets, investors poured the most cash into bitcoin-backed products in seven months as the cryptocurrency rallied past $50,000 last week, according to CoinShares.

The state of Alaska, one of the surprise winners from the GameStop short squeeze in January, cashed out most of its profit from its bet on the video-game retailer last quarter.

Gold rose 0.3% to $1,758.87 per ounce.

Oil prices were mixed. West Texas Intermediate crude tacked on 0.1% at $80.57 per barrel. Brent oil, the international benchmark, turned lower, down 0.2% to $83.46.

Bitcoin fell 2.9% to $55,698.24.

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US stocks fall as higher energy prices collide with lowered growth forecasts

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A trader works on the floor of the New York Stock Exchange (NYSE) in New York, U.S., March 9, 2020. REUTERS/Bryan R Smith

Bryan R Smith/Reuters

  • US stocks closed lower on Monday as fears of rising oil prices and slower growth hit investors.
  • Rising prices and slower growth are the prime ingredients of stagflation, which has historically been a poor environment for stock returns.
  • Since 1960, periods of rising inflation and weak GDP growth led to a median S&P 500 quarterly return of -2.1%, according to Goldman Sachs.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

US stocks closed lower on Monday, erasing early morning gains as investors grapple with a continued rise in inflationary pressures and the outlook for slower economic growth.

Energy prices continued their rise, with oil rising to a seven-year high above $80 per barrel as an ongoing supply crunch overseas helps boost prices for both oil and natural gas.

Goldman Sachs cut its US GDP forecast for the third month in a row due to an ongoing economic drag from the COVID-19 delta variant and the global semiconductor crunch.

Rising prices and slower economic growth are the necessary ingredients for stagflation, which has historically led to a weak median quarterly S&P 500 return of -2.1%, according to Goldman.

Here’s where US indexes stood at the 4:00 p.m. ET close on Monday:

Crypto mining manufacturer Bitmain said it will stop shipping its equipment to China following the government’s crackdown on cryptocurrency mining.

Ether co-founder Vitalik Buterin said “shame on bitcoin maximalists” who support El Salvador’s president in forcing businesses to accept the cryptocurrency.

JPMorgan CEO Jamie Dimon called bitcoin “worthless” at a conference on Monday and questioned its 21 million fixed supply.

SoFi surged as much as 14% after Morgan Stanley initiated the fintech company with an “overweight” rating and said the stock could surge 54% from Friday’s close.

Wedbush reiterated its bullish view on cybersecurity provider Palo Alto Networks, arguing the stock could rise 22% from current levels as it sees increased cyber security spending by the government.

Bank of America said Starbucks is poised to surge 21% as its loyalty rewards program drives growth and protects the coffee retailer from competition.

West Texas Intermediate crude oil rose as much as 1.85%, to $80.82 per barrel. Brent crude, oil’s international benchmark, jumped 1.61%, to $83.72 per barrel.

Gold fell as much as 0.14%, to $1,754.90 per ounce.

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US stocks mixed as surging oil and talk of stagflation worry investors

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Lucas Jackson/Reuters

  • US stocks were mostly lower on Monday as fears of rising oil prices and slower GDP growth hit investors.
  • Rising prices and slower growth are the prime ingredients of stagflation, which has historically been a poor environment for stock returns.
  • Since 1960, periods of rising inflation and weak GDP growth led to a median S&P 500 quarterly return of -2.1%, according to Goldman Sachs.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

US stocks were mostly lower in early Monday trading as investors grapple with a continued rise in inflationary pressures and the outlook for slower economic growth.

Energy prices continued their rise on Monday, with oil well over $80 per barrel as an ongoing supply crunch overseas helps boost prices for both oil and natural gas.

Goldman Sachs cut its US GDP forecast for the third month in a row due to an ongoing economic drag from the COVID-19 delta variant and the global semiconductor crunch.

Rising prices and slower economic growth are the necessary ingredients for stagflation, which has historically led to a weak median quarterly S&P 500 return of -2.1%, according to Goldman.

Here’s where US indexes stood shortly after the 9:30 a.m. ET open on Monday:

Crypto mining manufacturer Bitmain said it will stop shipping its equipment to China following the government’s crackdown on cryptocurrency mining.

Ether co-founder Vitalik Buterin said “shame on bitcoin maximalists” who support El Salvador’s president in forcing businesses to accept the cryptocurrency.

Wedbush reiterated its bullish view on cybersecurity provider Palo Alto Networks, arguing the stock could rise 22% from current levels as it sees increased cyber security spending by the government.

West Texas Intermediate crude oil rose as much as 1.85%, to $80.82 per barrel. Brent crude, oil’s international benchmark, jumped 1.61%, to $83.72 per barrel.

Gold fell as much as 0.14%, to $1,754.90 per ounce.

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US stocks fall as interest rates rise and traders nervously eye global energy crunch

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Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., January 17, 2019.

Brendan McDermid/Reuters

US stocks traded lower on Wednesday, giving up much of Tuesday’s gains as interest rates jumped higher amid an ongoing surge in energy prices.

The 10-year US Treasury yield hit a four-month high of 1.57% early Tuesday morning before falling back to around 1.52%. That move comes amid the ongoing uncertainty of a debt ceiling raise that Congress needs to enact before the Treasury Department runs out of money on October 18.

Treasury Secretary Janet Yellen has warned that failure to raise the debt ceiling in time would likely result in a surge in interest rates, which would raise borrowing costs and hurt the economy.

Meanwhile, energy prices continue to rise, both for oil and natural gas, as a surge in demand and lack of supply in Europe contributes to soaring costs.

Here’s where US indexes stood shortly after the 9:30 a.m. ET open on Wednesday:

SEC Chairman Gary Gensler said that his agency wouldn’t impose a cryptocurrency ban like China has, but added that Congress could. Meanwhile, SEC Commissioner Hester Peirce said it’s a shame regulators aren’t “taking up the mantle” to provide rule on digital currencies.

ARK Invest’s flagship ETF has sold nearly its entire position in Nintendo, ahead of an expected OLED screen update for its popular Switch videogame system.

The gains for Shiba Inu coin keep rolling in after an Elon Musk tweet helped spark a rally in the cryptocurrency. The coin is up more than 220% in the past week.

Charlie Munger’s Daily Journal Company has nearly doubled its stake in Chinese e-commerce giant Alibaba. The buys come amid a sharp decline in the stock as China continues to impose a regulatory crackdown against big business.

West Texas Intermediate crude oil fell as much as 1.03%, to $78.12 per barrel. Brent crude, oil’s international benchmark, fell 0.99%, to $81.74 per barrel.

Gold fell as much as 0.15%, to $1,758.20 per ounce.

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Nasdaq falls more than 2% as rising bond yields drag mega-cap tech names lower

Traders work at the New York Stock Exchange in New York, the United States, Nov. 20, 2018.
New York Stock Exchange on Nov. 20, 2018.

Xinhua/Wang Ying via Getty Images

US stocks tumbled on Monday dragged by tech-heavyweights like Facebook and Amazon amid rising Treasury yields.

The benchmark S&P 500 fell more than 1.5% – slipping below its 100-day moving average – while the tech-heavy Nasdaq 100 slid more than 2%.

Here’s where US indexes stood at the 4:00 p.m. ET close on Monday:

Facebook fell as much as 4% after a whistleblower alleged that the company does little to stop the spread of hateful content on its platform.

Global markets in the past weeks have been on a downtrend as investors try to anticipate when the Federal Reserve will begin tapering asset purchases amid inflationary pressures driven by a surge in commodity prices and supply chain issues.

These factors have pushed yields higher, with tech stocks in particular bearing the brunt.

“The Nasdaq is the punching bag as global bond yields rise and as many investors anticipate the cyclical rotation trade will become the playbook after the DC debt drama,” Edward Moya, senior market analyst at foreign exchange Oanda, said in a Monday note.

Also looming is the continuation of the debt ceiling crisis that Congress is trying to avert later this month.

A default would erode trust in the dollar and cause interest rates to soar, which would lift mortgage, car loan, and credit card costs for borrowers. S&P said it would cut its rating to the worst-possible rank of D in the event of a single non-payment on government debt.

Despite this, many analysts, including LPL Financial, remain bullish for the fourth quarter – a period that has historically been best time of year for stocks. Beyond 2021, chief market strategist Ryan Detrick and equity strategist Jeff Buchbinder are also optimistic.

“We see a favorable economic environment for stocks in 2022, consistent with prior mid-cycle expansion years and bolstered by continued earnings growth,” they said in a Monday note. “The gains may not come easy, however, with a number of risks.”

In cryptocurrencies, dogecoin spinoff shiba inu coin jumped 30% after Tesla CEO Elon Musk tweeted another picture of his puppy late Sunday.

Bank of America began coverage of digital assets in a report published Monday. According to the note, the crypto and blockchain sectors are simply too big for investors to ignore.

Oil prices spiked after OPEC+ on Monday agreed to keep its existing schedule of gradual hikes in oil production, adding to inflationary pressures engulfing global markets.

West Texas Intermediate crude oil jumped 2.37%, to $77.68 per barrel. Brent crude, oil’s international benchmark, rose 2.59%, to $81.33 per barrel.

Bank of America said last week that Brent crude could hit $100 a barrel for the first time since 2014.

Gold rose 0.17%, to $1,766.30 per ounce.

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Dow spikes 482 points after Merck’s COVID-19 pill boosts recovery optimism

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  • The Dow spiked 482 points on Friday after Merck announced successful data for its antiviral COVID-19 drug.
  • The drug cut hospitalizations and deaths in half for patients who tested positive for COVID.
  • The positive news from Merck offset new inflation data and Congress’ continued struggle to raise the US debt ceiling.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

The Dow Jones Industrial Average spiked nearly 500 points on Friday, erasing early morning losses after Merck announced successful results for its antiviral drug in the treatment of COVID-19, renewing optimism around the recovery from the pandemic.

Merck ended its phase three trial of molnupiravir early after it said hospitalizations and deaths were cut in half for patients that took the drug after being infected with COVID-19. The pharmaceutical company said it will file for emergency use authorization as soon as possible and plans to have 10 million available doses by the end of the year.

Merck’s positive drug data helped offset the biggest jump in inflation in 30 years, with core inflation jumping 3.6% in August, and Congress struggling to raise the US debt ceiling before the US Treasury runs out of money on October 18.

Here’s where US indexes stood at the 4:00 p.m. ET close on Friday:

Shares of Merck jumped as much as 12% on Friday after it announced positive data for its antiviral COVID-19 treatment. While Merck soared, vaccine makers like Moderna, Novavax, and BioNTech plummeted as much as 16%.

Bitcoin jumped as much as 9%, helping the popular cryptocurrency reclaim technical resistance levels represented by its 50-day and 200-day moving averages.

The SEC again delayed its decision on approval of a bitcoin ETF, pushing the deadline back 45 days as it mulls approval for a first ever US crypto fund.

Lordstown Motors fell 18% on Friday after the company gave a production update and confirmed that iPhone manufacturer Foxconn would purchase its Ohio plant for $230 million.

West Texas Intermediate crude oil jumped as much as 0.83%, to $75.65 per barrel. Brent crude, oil’s international benchmark, jumped 0.98%, to $79.08 per barrel.

Gold rose as much as 0.10%, to $1,758.70 per ounce.

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US stocks climb as progress on Merck’s antiviral pill offsets new inflation data

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Xinhua/Wang Ying/ Getty Images

  • US stocks moved higher Friday after Merck announced successful data for its antiviral COVID-19 drug.
  • The drug cut hospitalizations and deaths in half for patients who tested positive for COVID.
  • The positive news from Merck offset new inflation data and Congress’ continued struggle to raise the US debt ceiling.
  • Sign up here for our daily newsletter, 10 Things Before the Opening Bell.

US stocks turned positive on Friday after Merck announced successful results for its antiviral drug in the treatment of COVID-19.

Merck ended its phase three trial of molnupiravir early after it said hospitalizations and deaths were cut in half for patients that took the drug after being infected with COVID-19. The pharmaceutical company said it will file for emergency use authorization as soon as possible and plans to have 10 million available doses by the end of the year.

Merck’s positive drug data helped offset the biggest jump in inflation in 30 years, with core inflation jumping 3.6% in August, and Congress struggling to raise the US debt ceiling before the US Treasury runs out of money on October 18.

Here’s where US indexes stood shortly after the 9:30 a.m. ET open on Friday:

Shares of Merck jumped as much as 9% on Friday after it announced positive data for its antiviral COVID-19 treatment.

Bitcoin jumped as much as 9%, helping the popular cryptocurrency reclaim technical resistance levels represented by its 50-day and 200-day moving averages.

Lordstown Motors jumped 8% on Friday after the company said iPhone manufacturer Foxconn would purchase its Ohio plant for $230 million.

West Texas Intermediate crude oil fell as much as 0.07%, to $74.98 per barrel. Brent crude, oil’s international benchmark, jumped 0.04%, to $78.35 per barrel.

Gold fell as much as 0.04%, to $1,756.30 per ounce.

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