Stocks Surge Ahead Of Microsoft, Alphabet Earnings, Bitcoin Eyes Sixth Day Of Gains: What's Driving Markets Tuesday?

Stocks enjoyed a positive midday trading session in New York, with all major indices in the green. Additionally, nine out of 11 S&P 500 sectors posted gains.

Traders are eagerly anticipating earnings reports from tech giants Alphabet, Inc. GOOGL GOOG and Microsoft Corp. MSFT, scheduled for release after the market closes. Simultaneously, they are keeping a watchful eye on developments in the Israel-Hamas war.

China’s pursuit of an expanded policy stimulus has also buoyed market sentiment. Furthermore, better-than-expected U.S. PMI data for October indicates expansion in both the services and manufacturing sectors.

Bitcoin BTC/USD has surged for the sixth consecutive session, briefly surpassing $35,000 before retracing to $33,900 at the time of this writing.

Cues From Tuesday's Trading:

The S&P 500 was 0.2% higher Tuesday, on track to snap four sessions of losses. The Dow Jones also was 0.3% higher, while the tech-heavy Nasdaq 100 mirrored the broader market’s gains.

Small caps, as tracked by the Russell 2000 index, rose 0.4%.

US Index Performance On Tuesday

Analyst Color:

As four of the “Magnificent Seven” get ready to release their quarterly results, analysts are expecting positive earnings reports. Fund manager Louis Navellier said, “None are expected to see the volatility we’ve seen in Tesla, whose cars are vulnerable to higher loan rates and is in the far-from-mature electric vehicle market.”

Wharton professor Jeremy Siegel also expressed a similar opinion in his weekly WisdomTree commentary. “But in general, the stronger economy is supporting earnings growth in the fourth quarter and in 2024, which makes me bullish for 2024,” he said.

Navellier sounded a note of caution. “But it will be important that the rest of the Magnificent Seven don’t deliver any negative surprises.” He noted the stocks’ P/E multiples are higher than average and have been the primary benefactors of the enthusiasm for artificial intelligence potential.

Tuesday’s Trading In Major US Equity ETFs

• The SPDR S&P 500 ETF Trust SPY was 0.2% higher to $435.70.
• The SPDR Dow Jones Industrial Average ETF DIA was 0.3% higher to $330.28.
• The Invesco QQQ Trust QQQ fell 0.1% to $356, according to Benzinga Pro data.

Looking at S&P 500 sector ETFs:

• The Energy Select Sector SPDR Fund XLE was the laggard for the second day in a row, down 1.2%.
• The Utilities Select Sector SPDR Fund XLU was the outperformer, rising 2.45.

Stocks In Focus:

• Coinbase Global, Inc. COIN surged over 7% after an appeals court ordered the SEC to review the Grayscale Bitcoin BTC/USD spot ETF application. Other crypto-linked stocks such as Riot Platforms, Inc. RIOT and Marathon Digital Holdings, Inc. MARA were all higher by over 10%.
• Companies reacting to quarterly earnings reports include:
• 3M Company MMM, up 5.3%, Archer-Daniels-Midland Company ADM, down 2.4%, The Coca-Cola Company KO, up 2.6%, Dow Inc. DOW, up 1.4%, General Electric Company GE, up 0.2%, General Motors Company GM, down 0.5%, Halliburton Company HAL, down 3.4%, PulteGroup, Inc. PHM, up 2%, Novartis AG NVS, up 0.7%, Spotify Technology S.A. SPOT, up 9%, Verizon Communications Inc. VZ, up 9% and Xerox Holdings Corporation XRX, were among the notable companies reporting their quarterly results ahead of the market open.
• Those reporting after the close include Alphabet, Boyd Gaming Corporation BYD, Microsoft, Snap, Inc. SNAP, Texas Instruments Incorporated TXN and Visa, Inc. V.

Commodities, Bonds, Other Global Equity Markets:

Crude oil tumbled 3.2%, with a barrel of WTI-grade crude trading at $83. The United States Oil Fund ETF USO was 2.9% lower to $77.83.  

Treasury yields were broadly stable, with the 10-year yield hovering at 4.85% and the 30-year yield easing by 2 basis points. The iShares 20+ Year Treasury Bond ETF TLT was 0.5% lower for the day. 

The dollar rose, with the U.S. dollar index, which is tracked by the Invesco DB USD Index Bullish Fund ETF UUP, up 0.6%. The EUR/USD pair, which is tracked by the Invesco CurrecyShares Euro Currency Trust FXE, was 0.8% lower to 1.0548.

European equity indices had a mixed session. The SPDR DJ Euro STOXX 50 ETF  FEZ held steady.

Gold edged 0.3% up to $1,975/oz. Silver was flat at $22.95. Bitcoin BTC/USD was 3% higher to $26,078.

Staff writer Piero Cingari updated this report midday Tuesday. 

Related Link: 10-Year Yield At 5% Triggers Waves Of Treasury Buyers: Bill Ackman, Technical Indicators Hint At Potential Shift

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