The S&P 500 and the Dow Jones Industrial Average rose to fresh records Monday as investors awaited the next batch of key corporate earnings.
The broad market index climbed 0.77% to 5,859.85, while the 30-stock Dow advanced 201.36 points to 43,065.22. Both averages hit all-time highs and closed at records, with the Dow ending the session above the 43,000 mark for the first time. The Nasdaq Composite added 0.87%, closing at 18,502.69.
McDonald’s, UnitedHealth Group and Apple led the Dow higher. Technology continued its upward run and was the best-performing sector in the S&P.
Bank of America, Goldman Sachs and Johnson & Johnson report their latest results on Tuesday, while Morgan Stanley and United Airlines are set to release results Wednesday. Walgreens Boots Alliance, Netflix and Procter & Gamble are also scheduled to post earnings this week.
Those reports will come after JPMorgan Chase and Wells Fargo kicked off the third-quarter earnings season on a high note. The early signs of a recovery in banking profits helped push the broader market to all-time highs at the end of last week. The S&P 500 closed above 5,800 for the first time on Friday, while the blue-chip Dow also reached an all-time high.
So far, 30 S&P 500 companies have posted results, beating the earnings consensus by about 5% on average, according to Bank of America. That is better than the 3% beat this time last quarter. Still, Bernstein thinks this quarter’s year-over-year earnings per share growth rate will come in “much lower” than last quarter’s.
Despite the market climbing to new all-time highs, investors remain anxious against a backdrop of a closely contested presidential election in three weeks, suddenly rising Treasury yields, uncertainty about the pace of Federal Reserve policy easing and escalating geopolitical risks in the Middle East.
“All-time-highs sentiment is maybe a little stretched, so it wouldn’t be surprising — especially in the last three or four weeks before an election — to see some volatility return,” said Baird investment strategist Ross Mayfield. “Over a three- or six-month-plus time horizon we’re still pretty bullish just on the idea of lower rates for the right reason, soft landing in the economy and earnings growth.”
The S&P 500 has gained almost 23% this year, excluding reinvested dividends. The bull market recently turned two years old, and the benchmark has rallied about 63% in total since hitting a closing low in October 2022. Treasury yields have risen lately, too, with the benchmark 10-year note yield, used to calculate everything from mortgages to auto loans, topping 4.1% last week.
The bond market was closed on Monday for Columbus Day.