S&P 500 Muted With Eyes On Earnings Season

(Reuters) - The S&P 500 was subdued on Tuesday with investors holding off big bets ahead of the earnings season that is expected to throw light on the health of Corporate America and the economy.

General Motors Co (NYSE:GM) jumped 4% after Chief Executive Mary Barra outlined plans for its first BrightDrop electric commercial vans to be delivered to FedEx (NYSE:FDX) by year-end.

High-flying shares of Tesla (NASDAQ:TSLA) Inc added another 3%.

Five of the 11 major S&P sectors were trading higher with energy stocks rising more than 3%, tracking higher crude prices. [O/R]

Rate-sensitive banks climbed 1.2% as benchmark U.S. Treasury yields reached their highest levels since March. [US/]

Hopes of a big boost to public spending and speedy rollout of vaccines under a Democratic-led U.S. Congress have pushed Wall Street to record highs, with growth-linked financial, industrial and energy stocks lifting the market higher.

"On an average, markets look 3-6 months into the future about what environment we are likely to be dealing with, allowing it to push back on events in Washington last week and the surge in the COVID-19 cases," said Matt Stucky, portfolio manager, equities, at Northwestern (NASDAQ:NWE) Mutual Wealth Management Company in Milwaukee, Wisconsin.

"There is a lot of bright news on the horizon on vaccine rollouts and a likelihood of more fiscal stimulus in Washington."

In the previous session, the three main indexes had ended below their all-time highs, as investors worried that attempts to impeach President Donald Trump could delay the Joe Biden administration's first moves on stimulus, spurring some profit-taking on the past month's gains.

Democrats will give Trump one last chance on Tuesday to leave office days before his term expires or face an unprecedented second impeachment over his supporters' storming of the U.S. Capitol on Jan. 6.

"Even if (additional stimulus) is delayed, it's going to be a matter of days, maybe weeks, not months. The question is the shape and form of it," said Keith Buchanan, portfolio manager at GlobAlt in Atlanta.

At 10:10 a.m. ET, the Dow Jones Industrial Average rose 11.88 points, or 0.04%, to 31,020.57, the S&P 500 gained 2.33 points, or 0.06%, to 3,801.94 and the Nasdaq Composite gained 27.57 points, or 0.21%, to 13,064.00.

The small-cap Russell 2000 index gained about 1%.

Fourth-quarter earnings will take center stage starting Friday, with results from JPMorgan (NYSE:JPM), Citigroup (NYSE:C) and other big banks launching the reporting season.

Earnings for S&P 500 companies are expected to have dropped 9.8% year-over-year in the final quarter of 2020, according to IBES data from Refinitiv, but they are expected to rebound in 2021, with a gain of 16.4% projected for the first quarter.

Albertsons Cos Inc rose 2.1% after the grocer reported quarterly sales above estimates, as consumers wary of rising coronavirus cases stocked their pantries and cooked more at home.

Advancing issues outnumbered decliners by a 1.6-to-1 ratio on the NYSE and by a 1.9-to-1 ratio on the Nasdaq.

 

The S&P 500 posted 57 new 52-week highs and no new low, while the Nasdaq recorded 233 new highs and eight new lows.

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