Surging Treasury yields were also in focus
Wall Street saw no reprieve from the volatility that defined most of October, except this week the earnings season played a big role in those sharp moves up and down the charts. The Dow Jones Industrial Average (DJI) enjoyed upbeat results from Goldman Sachs (GS) and Johnson & Johnson (JNJ), reclaiming the 30,000 region as the tech-heavy Nasdaq Composite Index (IXIC) registered its best single-session gain since July 27.
Strong quarterly results were no match for surging Treasury yields, though, as the 10-year benchmark climbed to a high of 4.222% — a level not seen since 2008. In addition, the Federal Reserve’s Beige Book showed that though inflation has somewhat eased, prices continue to rise as the U.S. economy grows modestly and at a slower pace. The three major benchmarks were eyeing sizable weekly wins at the time of this writing, however.
Top Earnings Reports
The earnings season was in full-swing over the past week. Bank of America (BAC) was among the first to report, with higher interest rates leading the company to a quarterly win, while GS surged after revealing restructuring plans. Other blue chips stepped into the confessional as well, with JNJ enjoying growing pharmaceutical sales, as Travelers (TRV) brushed off a 20% drop in profits amid hurricane-related claims and lower returns on investments. Meanwhile, options traders blasted Procter & Gamble (PG) following a fiscal first-quarter top- and bottom-line beat.
Big Tech also made its appearance. Netflix (NFLX) soared upon announcing it added 2.4 million subscribers, and Tesla (TSLA) took a massive hit when it slashed its full-year delivery target. Another tech name under fire was Snap (SNAP), which saw its third-quarter revenue grow at the slowest pace since the social media concern went public. Hasbro’s (HAS) profit miss had the toymaker struggling, too, while Generac’s (GNRC) preliminary quarterly results put the security on track for its worst day ever. Call traders also eyed both Freeport-McMoRan (FCX) and CSX (CSX) after their respective reports.
Notable Headlines This Week
There was more to this week than a busy earnings docket, though. Software concern Splunk (SPLK) revealed activist investor Starboard Value LP has a roughly 5% stake in the company, and online game platform Roblox (RBLX) shared impressive key metrics for September. In other news, Aveo Pharmaceutical (AVEO) soared on rumors of a $566 million buyout deal, and Adobe’s (ADBE) reaffirmed 2022 forecast gave the shares a nice boost. Finally, SNAP’s quarterly miss negatively impacted Meta Platforms (META) and Twitter (TWTR), both of which also rely heavily on ad revenue.
End of October Brings Another Earnings Deluge
The last week of October will bring investors another massive batch of earnings, featuring Tech names and blue chips alike, including 3M (MMM), Alphabet (GOOGL), Amazon.com (AMZN) Apple (AAPL), Boeing (BA), Coca-Cola (KO), McDonald’s (MCD), Pinterest (PINS), Roku (ROKU), Spotify (SPOT), Twitter (TWTR), and Visa (V). In terms of economic data, Wall Street will be primarily eyeing the S&P U.S. manufacturing and services purchasing managers’ indexes (PMI), in addition to a gross domestic product (GDP) update. Until then, find out what the SPX did for the first time since 2018, and don’t expect smooth market rallies going forward.
Image and article originally from www.schaeffersresearch.com. Read the original article here.