Dow Industrial Earnings Push U.S. Stocks Closer to Record Highs
The U.S. stock market advanced on Tuesday after a pair of Dow industrials reported better than expected earnings, easing concerns about a dismal quarter for Corporate America. In alternative markets, cryptocurrencies faced swift declines after bitcoin’s price swung back below $10,000.
Dow, S&P 500, Nasdaq Finish Higher
All three of Wall Street’s major indexes finished in positive territory, with the Dow Jones Industrial Average gaining 177.29 points, or 0.7%, to 27,349.19. The industrial benchmark was up by as much as 198 points.
The broad S&P 500 Index of large-cap stocks gained 0.7% to close at 3,005.47. Ten of 11 sectors reported gains, led by materials, which added 1.9%. Shares of financials, industrials and real estate companies also outperformed the market, rising at least 1%.
The technology-focused Nasdaq Composite Index climbed 0.6% to finish at 8,251.40.
Earnings Surprise to the Upside
Dow blue-chip Coca-Cola Co (NYSE:KO) reported better than expected earnings on Tuesday thanks to higher sales of its flagship product. The company’s second-quarter adjusted earnings per share came in at 63 cents on revenues of $10 billion. Analysts in a median estimate had called for an EPS of 61 cents on revenue of $9.99 billion.
Coke’s stock price rose 6% on Tuesday to $54.33.
United Technologies (NYSE:UTX), another Dow component, also posted better than expected quarterly results. The industrial conglomerate turned a profit of $2.20 per share on $19.6 billion in sales. The company’s stock finished up 1.5% at $134.94.
As of Tuesday, 18% of S&P 500 companies had reported second-quarter earnings. Among them, 78% have reported stronger than expected profits, according to FactSet These companies have seen their earnings climb by an aggregate 3.6%. Before earnings season began, analysts at FactSet predicted a profit decline of 3% for S&P 500 companies.
Crypto Markets Slump
Bitcoin and Tron led a broad reversal in the cryptocurrency market on Tuesday, as total coin values lost a combined $12 billion. The market bottomed around $272 billion before recovering slightly in afternoon trading.
Tron was down more than 22% at one point after a Chinese news site accused its founder, Justin Sun, of several improprieties ranging from illegal fundraising to money laundering. Sun has strongly denied the rumors.
Bitcoin continued to exert a strong gravitational pull on the broader market after its price fell below $10,000 for the second time in as many weeks. The bitcoin price reached an intraday low of $9,860.80 on Bitstamp and struggled to regain the five-figure level for most of the session.
The leading digital currency would eventually return above $10,100, having erased most of its intraday losses.
Disclaimer: The author owns Bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
Featured image courtesy of Shutterstock. Charts via Stockcharts.com and CoinMarketCap.