US Stocks climb amid solid third-quarter U.S. earnings, economic data

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Updated: October 15, 2021 6:45 PM

Applications for U.S. state unemployment benefits fell to the lowest since March 2020, showing employers are hanging onto their workers in a tight labor market.

S&P 500, US Stocks, earnings season, Equity investors, economic dataThe third-quarter U.S. earnings season could help investors put supply-chain risks in perspective.

Bloomberg: Stocks rose as better-than-estimated earnings and economic data overshadowed concern that inflation pressures and supply-chain snarls will weigh on growth.

All major groups in the S&P 500 advanced. Bank of America Corp. climbed after beating analysts’ earnings estimates as fees jumped at its dealmaking unit. Morgan Stanley, Wells Fargo & Co. and Citigroup Inc. also reported solid results. Chipmakers rallied on a strong forecast from Taiwan Semiconductor Manufacturing Co., while UnitedHealth Group Inc. led gains in the Dow Jones Industrial Average as the health-care giant raised its outlook for the year.

Applications for U.S. state unemployment benefits fell to the lowest since March 2020, showing employers are hanging onto their workers in a tight labor market. Prices paid to American producers rose at the slowest pace of the year amid cooling costs of services. The PPI has climbed steadily in 2021 as interruptions in supply networks and constraints that include shortages of materials and labor, drive up costs.

“Equity investors have become more cautious over the last couple of months,” said Mark Haefele, chief investment officer at UBS Global Wealth Management. “But we think these concerns will abate in the coming months, and that the third-quarter U.S. earnings season could help investors put supply-chain risks in perspective.”

Chip stocks have felt the wrath of rising bond yields lately, but the sector’s main players may get a boost from investors searching for companies with the ability to pass on higher costs to customers. Bank of America analysts tout market leaders like ASML Holding NV, Soitec, Infineon Technologies AG and ASM International NV as being best placed to withstand inflationary pressures, given a lack of alternative suppliers.

Some other corporate highlights:

Walgreens Boots Alliance Inc.’s fiscal fourth-quarter earnings and sales beat estimates as the Covid-19 pandemic and the U.S. immunization campaign continued to have a powerful effect on the drugstore giant’s results.

Beyond Meat Inc. jumped after McDonald’s Corp. confirmed testing a burger created with the developer of plant-based protein products.

Domino’s Pizza Inc. reported revenue for the third quarter that missed the average analyst estimate.

Here are a few events to watch this week:

Goldman Sachs Group Inc. reports earnings on Friday

U.S. business inventories, University of Michigan consumer sentiment, retail sales on Friday

Some of the main moves in markets:

Stocks

The S&P 500 rose 1% as of 9:53 a.m. New York time
The Nasdaq 100 rose 1.3%
The Dow Jones Industrial Average rose 1%
The Stoxx Europe 600 rose 1.1%
The MSCI World index rose 1%

Currencies

The Bloomberg Dollar Spot Index was little changed
The euro was little changed at $1.1596
The British pound rose 0.3% to $1.3699
The Japanese yen fell 0.3% to 113.62 per dollar

Bonds

The yield on 10-year Treasuries was little changed at 1.54%
Germany’s 10-year yield declined five basis points to -0.18%
Britain’s 10-year yield declined four basis points to 1.05%

Commodities

West Texas Intermediate crude rose 0.4% to $80.75 a barrel
Gold futures rose 0.1% to $1,796.60 an ounce

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