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Market Snapshot: Dow, S&P 500 end at all-time records as U.S. stocks extend winning streak amid strong company earnings

The Dow Jones Industrial Average and S&P 500 indexes ended at all-time highs Tuesday, notching back-to-back closing records, as U.S. stock benchmarks extended their winning run as investors faced an onslaught of corporate earnings reports.

What did major stock benchmarks do?

The Dow Jones Industrial Average

edged up 15.73 points, or less than 0.1%, to close at a record 35,756.88, after rising to an all-time intraday high of 35,892.92 in earlier activity.

The S&P 500

rose 8.31 points, or 0.2%, to finish at a new peak of 4,574.79, after hitting an intraday record, at 4,598.53.

The Nasdaq Composite

advanced 9.01 points, or 0.1%, to end at 15,235.71. The tech-heavy index traded as high as 15,384, briefly topping its closing record of 15,374.33 from Sept. 7.

On Monday, both the Dow and the S&P 500 ended at record highs, with the Nasdaq Composite closing within 1% away from a new high.

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What drove the market?

Investors pushed stock benchmarks higher Tuesday as they continued to digest company earnings reports for the third quarter.

“Investors are shrugging off concerns about inflation. Instead, they are focusing on the corporate earnings season, which continues to surprise on both side of the Atlantic,” said Fawad Razaqzada, market analyst at ThinkMarkets, in a note.

See: Why it’s wrong to compare today’s inflation surge to 1970s-style ‘stagflation’

The S&P 500 index has advanced for nine of the last 10 sessions as third-quarter earnings reports have largely topped expectations.

“Companies are still able to put through a lot of their prices increases,” said Paul Nolte, a senior portfolio manager at Kingsview Investment Management, in a phone interview Tuesday. “So far, it seems the consumer is taking higher prices in stride.”

Tuesday’s earnings wave included General Electric Co.
3M Co.
and, after the market close, Google parent Alphabet Inc.

and Microsoft Corp.
Social-media giant Facebook Inc.

fell 3.9% after it surpassed third-quarter earnings estimates but issued a revenue outlook below Wall Street forecasts.

In economic data released Tuesday, the S&P CoreLogic Case-Shiller Home Price Index showed that home prices increased nationally 19.8% from a year ago in August, roughly in line with the previous month’s increase. The separate 20-city index, which measures price appreciation among a group of major metropolitan areas across the country, showed a 19.7% year-over-year gain, down from a revised 20% annual gain the month before.

Meanwhile, U.S. new-home sales increased 14% to an annual rate of 800,000 in September, the government said Tuesday. The median forecast of economists polled by MarketWatch had been for new home sales to come in at an annual rate of 760,000 for September.

“The housing market is strong,” said Eric Winograd, senior economist at AllianceBernstein, in a phone interview Tuesday. “Interest rates are very low,” he said, while “housing demand is very high.”

The Conference Board said its U.S. consumer confidence index rose to 113.8 in October from a revised 109.8 a month earlier. The gain follows three straight declines in sentiment. Economists polled by The Wall Street Journal had forecast a decline to 108.

“It was encouraging, certainly, to see consumer confidence tick up,” said Winograd. “Consumer confidence has tracked the COVID situation pretty closely, and with the delta variant fading, it’s good to see consumers responding.”

Which companies were in focus?

Shares of General Electric

closed 2% higher after the industrial conglomerate reported third-quarter profit and industrial free cash flow that beat expectations, while providing an upbeat full-year earnings outlook.

3M Co.

shares slipped 0.1% after the maker of Post-it Notes and diversified industrial company topped forecasts for the third quarter.

Shares of Lockheed Martin Corp.

dropped 11.8% after the defense contractor’s profit and sales fell and sales came in below consensus estimates.

Raytheon Technologies Corp.

reported earnings and revenue that topped forecasts while raising its 2021 outlook. Shares fell 2.3%.

Shares of drugmaker Eli Lilly & Co.

rose 1.4% after missing estimates on earnings but topping sales expectations.

United Parcel Service Inc.

reported third-quarter profit and revenue that beat expectations, with all business segments topping forecasts. Shares jumped about 7%.

What did other markets do?

The yield on the 10-year Treasury note

fell 1.6 basis points to 1.618%. Yields and debt prices move in opposite directions.

The ICE U.S. Dollar Index
a measure of the currency against a basket of six major rivals, was up 0.1%.

Oil futures ended higher, with the U.S. benchmark

rising 1.1% to settle at $84.65 a barrel. Gold futures

settled 0.7% lower at $1,793.40 an ounce.

The Stoxx Europe 600 index

ended 0.7% higher, while London’s FTSE 100

gained 0.8%.

The Shanghai Composite

was down 0.3%, while the Hang Seng Index

fell 0.4% and Japan’s Nikkei 225

jumped 1.8%.

—Steve Goldstein contributed to this report.

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