Stocks were close to trading record highs as investors waited for results from more of the largest US companies.
The futures for the S&P 500 gained 0.2% on Wednesday, a day after the broad stock index closed at an all-time high for the 57th time this year. Futures for the Dow Jones Industrial Average – which also closed on Tuesday at a record – rose about 0.1%. Contracts for the technology-driven Nasdaq-100 rose 0.2% on Wednesday.
Solid quarterly earnings from American companies have dampened investor worries about supply chain problems, inflation, and Chinese economic growth that rocked markets early this fall. The S&P 500 was up 6.2% in October and on track for its biggest monthly increase since November.
“Investors got pretty grim in September, clearly amid all sorts of macro concerns,” said Paul O’Connor, head of the multi-asset team at Janus Henderson Investors. “The more general story of the results is that companies handle these dynamics pretty well and handle expectations pretty well as well.”
Money managers still have concerns that range from the fate of President Biden’s infrastructure and social spending plans to the possible suspension of the Federal Reserve’s stimulus measures that have been buoyant in markets since early 2020, expecting modest, if bumpy, returns by the end of the year .
Results from Coca-Cola,
McDonald’s and Kraft Heinz, expected before the opening bell, will provide guidance on how companies are dealing with the shortage of manpower and raw materials. Harley Davidson,
Boeing BA -1.44%
and General Motors will also be reporting before the stock market starts trading, while Ford Motor and eBay will be on the block after the market closes.
On the economic front, data on orders for durable goods is due to be released at 8:30 a.m. ET. Economists polled by FactSet estimate that September orders were down 1% from August, driven by disruptions in supply chains in the automotive and other sectors.
In the bond market, the yield on 10-year Treasury bills rose from 1.618% on Tuesday to 1.626% on Wednesday. Yields are moving in the opposite direction to bond prices.
There were broad declines in the overseas markets. The Stoxx Europe 600 lost 0.2% and pulled back from its second-highest closing price on record as stocks of commodities, automotive and financial companies lost ground. Deutsche Bank lost 4.3% after the German lender reported a decline in investment banking revenues.
Asian markets fell after American officials suspended China Telecom,
China’s largest telecommunications provider operating in the US is fueling investor concerns about tensions between the two largest economies. China’s Shanghai Composite Index fell 1% and Hong Kong’s Hang Seng fell 1.6%.
Oil prices fell from their seven-year high as traders waited for 10:30 am data on US oil deliveries. The price of copper fell 0.8% on the London Metal Exchange to around $ 9,789 per ton.
Solid gains helped allay worries that rocked markets early in autumn.
Spencer Platt / Getty Images
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