Wall Street’s main indexes rose on Tuesday as investors hoped for more stimulus from Washington, with Senate Republicans preparing to vote on a bill to help small businesses hammered by the COVID-19 pandemic.
House of Representatives Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin will also talk again on Tuesday, after a 53-minute telephone conversation on Monday “continued to narrow their differences” about the coronavirus aid package, a Pelosi spokesman said on Twitter.
“The stimulus package seems to be the major fixation for investors right now — the idea of Republicans and Democrats agreeing on the next payments going forward,” said Rick Meckler, a partner at Cherry Lane Investments in New Vernon, New Jersey.
Uncertainty over the fiscal stimulus weighed on Wall Street’s main indexes on Monday and analysts expect market turbulence to increase with only two weeks left until Election Day.
Latest national opinion polls pointed to a victory for Democratic challenger Joe Biden, which would mean a cooling in global trade friction, but higher taxes for corporate America.
Meanwhile, the third-quarter earnings season has gathered momentum. Of the 50 S&P 500 companies that have reported results, 86% have topped expectations for earnings, according to Refinitiv IBES data.
Property and casualty insurer Travelers Cos Inc gained 3.3% as it beat quarterly profit expectations, while consumer products giant Procter & Gamble Co advanced 1.9% as it raised its full-year sales forecast.
All 11 major S&P sector were up in early trading with financials tracking U.S. Treasury yields. [US/]
At 9:47 a.m. ET, the Dow Jones Industrial Average was up 177.90 points, or 0.63%, at 28,373.32, the S&P 500 was up 23.91 points, or 0.70%, at 3,450.83. The Nasdaq Composite was up 70.89 points, or 0.62%, at 11,549.77.
Netflix Inc dipped 0.2% ahead of its third-quarter earnings report.
International Business Machines Corp edged past estimates for quarterly revenue on Monday, bolstered by higher demand for its cloud services. The company's shares, however, fell 3.3% after it stayed away from issuing a current-quarter forecast, citing economic uncertainty related to the pandemic.
The U.S. Justice Department and 11 states filed an antitrust lawsuit against Alphabet Inc's Google for allegedly breaking the law in using its market power to fend off rivals. Alphabet's shares were up 0.9% in morning trading.
Advancing issues outnumbered decliners 4.23-to-1 on the NYSE and 2.54-to-1 on the Nasdaq.
The S&P index recorded six new 52-week highs and one new low, while the Nasdaq recorded 28 new highs and 12 new lows.
Reporting by Medha Singh and Shivani Kumaresan in Bengaluru; Editing by Shounak Dasgupta