S&P 500 Trades at New High
By Avantika Chilkoti
The S&P 500 set a new intraday high Monday to kick off a
busy week of corporate earnings and economic data.
The index climbed 0.6% to 3040.56, passing its previous record
of 3027.98 from July 26. The Dow Jones Industrial Average gained
0.6%, and the technology-heavy Nasdaq Composite added 0.8%, putting
both indexes within 1% of their records.
Hopes for lower interest rates and a resolution to the
long-simmering trade dispute between the U.S. and China have
propelled stocks this year after a brutal selloff to end 2018. The
S&P is up 21% in 2019 and 14% from a year ago.
Nearly 150 companies in the S&P are on tap to report this
week, including General Motors, Facebook and Apple. Most reports
have beaten the low expectations of analysts, but earnings are
still on track to fall 3.8% from a year earlier, according to
The lack of growth in corporate third-quarter earnings is
largely because the three-month period a year earlier was unusually
strong, said Esty Dwek, a strategist at Natixis Investment
Managers. Fast-moving geopolitical events are also holding back
corporate performance, she said.
"It's a confirmation that there's a lot of uncertainty, and the
more you can remove some of this uncertainty the more you'll have
better guidance and confidence in terms of hiring and investing,"
Ms. Dwek said.
The Federal Reserve, meanwhile, is expected to cut interest
rates for the third time this year at the conclusion of its meeting
Wednesday. And investors will be paying close attention to the next
U.S. jobs report Friday for clues on the health of the economy.
Corporate news drove swings in individual stocks Monday. Shares
of Tiffany surged 28% after LVMH Moët Hennessy Louis Vuitton
confirmed it is talks for a potential takeover that would value the
iconic jewelry brand at $14.5 billion. Shares in LVMH gained
Microsoft gained 2.8% after the software company won a contract
worth up to $10 billion over the next decade from the Pentagon.
AT&T added 5% after the company struck a truce with an activist
In Europe, the pan-continental Stoxx Europe 600 index added
0.3%. HSBC Holdings was among the biggest losers in Europe,
shedding 3.7% after the bank dropped its main financial target and
said it would speed up plans to revamp its U.K., U.S. and European
The U.K.'s FTSE 100 gauge ticked up 0.1% as U.K. Prime Minister
Boris Johnson urged lawmakers to support his push for a Dec. 12
general election as a way to clear a path to Brexit. European Union
leaders agreed to a three-month extension to the Brexit deadline,
extending the political uncertainty until Jan. 31.
Asian markets had a stronger start to the week. The Shanghai
Composite Index gained 0.9% and Hong Kong's benchmark Hang Seng
Index climbed 0.8%.
The yield on 10-year Treasurys rose to 1.854%, from 1.805%
Friday, as investors anticipate the Federal Reserve will cut
interest rates again this week.
Karen Langley contributed to this article.
Write to Avantika Chilkoti at Avantika.Chilkoti@wsj.com
(END) Dow Jones Newswires
October 28, 2019 10:58 ET (14:58 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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