A bumpy day on Wall Street ends with stock indexes mixed
Stocks swerved to a mixed finish on Wall Street on Monday, ahead of a deluge of corporate earnings reports scheduled to arrive this week.
The Standard & Poor’s 500 rose 13.89 points, or 0.4%, to 3,855.36 as gains for influential Big Tech stocks were big enough to steady the index and return it to a record. It recovered from a 1.2% loss earlier in the day, as investors expect Apple and other tech giants to report healthy profits for the end of 2020 in coming days.
Other areas of the market were softer, though, and the majority of stocks on Wall Street fell amid concerns about the still-raging pandemic, delayed COVID-19 vaccine rollouts in some places and Washington’s ability to deliver stimulus to blunt the resulting economic pain.
The Dow Jones industrial average dipped 36.98 points, or 0.1%, to 30,960.00. The Nasdaq composite, which is packed with tech stocks, rose 92.93 points, or 0.7%, to 13,635.99 and another record. The Russell 2000 index of smaller stocks fell 5.49 points, or 0.3%, to 2,163.27.
The yield on the 10-year Treasury sank to 1.03% from 1.07% late Friday.
More than 100 companies in the S&P 500 are scheduled to tell investors this week how they fared during the last three months of 2020. They include American Express, Johnson & Johnson, 3M, AT&T and Tesla.
Through the earliest parts of this earnings reporting season, companies have largely been clearing the very low bar of expectations Wall Street had set for them. As a whole, analysts expect S&P 500 companies to say their fourth-quarter profit fell 5% from a year earlier. That’s a milder drop than the 9.4% they were forecasting earlier this month, according to FactSet.
Huggies and Kleenex maker Kimberly-Clark was the latest big company to report better profit than analysts expected, and its stock rose 3.3% Monday.
GameStop, the video-game retailer that’s struggling to return to profitability, went on another wild ride, trading in a giant range between $61.13 and $159.18 in heavy trading volume. The stock was halted nine times for volatility.
Some high-profile investors have been saying its stock price was too high and placed bets to profit from an eventual drop by “shorting” it, or borrowing shares of GameStop and selling them. But as the shares keep rising, these investors are forced to get out of their bets by buying the stock, pushing the price up further. It finished Monday up $11.78, or 18.1%, to $76.79. It was close to $17 a few weeks ago.
Financial stocks were the biggest drag on the market. Bank of America fell 1.2%, and Morgan Stanley dropped 2.4%. Travel-related companies also slipped as the virus pandemic continues crimping business. Carnival fell 4.9% after telling investors it would delay operations for several ships until November.
The Federal Reserve will begin a two-day meeting on interest-rate policy Tuesday, and the wide expectation is for it to keep the accelerator floored on its stimulus for the economy and markets. It has said it plans to keep interest rates low even if inflation rises above its 2% target.
In European stock markets, Germany’s DAX fell 1.7%, and France’s CAC 40 slipped 1.6%. The FTSE 100 in London dipped 0.8%.
Asian stocks were stronger. South Korea’s Kospi rose 2.2%, and Japan’s Nikkei 225 rose 0.7%. Hong Kong’s Hang Seng added 2.4%, and stocks in Shanghai gained 0.5%.
