S&P 500, Dow hit record highs, boosted by bank earnings surprise

Reuters

S&P 500, Dow hit record highs, boosted by bank earnings surprise

2024年10月11日，GMT下午6:42

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JPMorgan, Wells Fargo rally after Q3 results

Tesla reverses after unveiling robotaxi

Monthly PPI unchanged

Indexes up: Dow 0.90%, S&P 500 0.61%, Nasdaq 0.37%

Updated prices at 2:28 p.m ET/ 1828 GMT

By Sinéad Carew and Lisa Pauline Mattackal

Oct 11 (Reuters) -The S&P 500 and the Dow hit record highs on Friday, with the biggest boosts from financial stocks after banks reported strong quarterly results while the latest inflation data supported expectations for a U.S. Federal Reserve rate cut in November.

Major financial companies kicked off the earnings season with JPMorgan Chase JPM.N rising 5%after the lender reported higher-than-expected third-quarter profit and raised its annual interest income forecast.

Wells Fargo WFC.N rose 6%,after its profit also beat analysts' expectations. BlackRock BLK.N gained 3% after the asset manager reported that itsassets under management had hit a record high for the third straight quarter.

Other stocks in the industry rosebroadly, with the S&P 500 Financialsindex .SPSY climbing 2% to a record high, the S&P 500 Banks index .SPXBK rising 4.6%to its highest level sinceFebruary 2022, and the KBW regional bank index .KRX up almost 3%.

"We'd some good earnings reports from some leading financial companies. That's a good start to earnings season," said Evan Brown, Portfolio Manager and Head of Multi-Asset Strategy, UBS Asset Management, adding that it bodes well for the economy.

"When financials do well, this is what a soft landing looks like. It's a positive overall sign for the economy and sets a positive tone for earnings releases in other industries in the next few weeks."

Also on Friday, data from the U.S. Department of Labor showed the Producer Price Index for final demand was unchanged on a monthly basis in September, compared to the 0.1% rise expected by economists polled by Reuters.

"When you look at the components of PPI that go into the core PCE print, including healthcare and financial services, they looked benign on balance, suggesting that inflation is not running away from us," said Brown.

The data follows Thursday's Consumer Price Index reading, which was slightly higher than forecast, although weekly jobless claims rose more than expected.

Meanwhile, a preliminary reading of the University of Michigan's October consumer sentiment index stood at 68.9, compared with analysts' estimate of 70.8.

With the week's data under their belts, traderskept bets steady for a roughly 90% probability the Fed would cut rates by 25 basis points at its November meeting, and a 10% chance itwill leave rates unchanged, according to CME's FedWatch tool.

All three of Wall Street's major indexes were on track to notch their fifth consecutive week of gains.

At 02:28 p.m. on Friday, the Dow Jones Industrial Average .DJI rose 380.89 points, or 0.90%, to 42,834.83, the S&P 500 .SPX gained 35.06 points, or 0.61%, to 5,815.11 and the Nasdaq Composite .IXIC gained 68.08 points, or 0.37%, to 18,350.13.

Among the S&P 500's 11 major industry indexes the only decliner was consumer discretionary .SPLRCD.

The consumer index was under pressure from a8% slump in Tesla TSLA.O, which also limited gains on the Nasdaq, after the EV maker unveiled its long awaited robotaxi, but did not provide details on how fast it could ramp up production or deal with potential regulatory hurdles.

Q3 earnings seen positive for most S&P 500 sectors https://reut.rs/3Bv5SNg

Monthly change in US Producer Price Index https://reut.rs/4h1LO59

Reporting by Sinéad Carew, Lisa Mattackal and Pranav Kashyap in Bengaluru; Editing by Pooja Desai and David Gregorio

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