Stocks ended mixed Tuesday as Wall Street reacted to the week's latest earnings reports.
The Dow Jones Industrial Average slipped 6.71 points, or 0.02%, to end the session at 42,924.89, while the S&P 500 lost 0.05% to close at 5,851.20 and the tech-heavy Nasdaq inched up 0.18% to finish the day at 18,573.13.
"The last couple of days, the market has been trying to digest the move in treasuries as you've had a pretty big backup in yields. So the relative calm today in the treasury market brought a little bit of ease," Jack Janasiewicz, portfolio manager at Natixis Investment Managers Solutions, told Reuters.
Michael Green, portfolio manager at Simplify Asset Management, said that “the big story overall is the rates back up and the concerns that the Federal Reserve made a policy error by moving too aggressively in September.”
“That's feeding through to a rate sell off on a global basis,” Green said.
Updated at 12:36 PM EDT
Oil slick
Global oil prices are driving higher heading into the early afternoon session, with U.S. crude trading firmly north of the $70 per barrel mark, amid concerns over escalating tensions in the middle east and the demand impact from fiscal stimulus in China.
"Lingering tension in the Middle East continues to provide support as the market awaits Israel’s response to Iran’s recent attack," said ING's head of commodities strategy Warren Patterson. "In addition, a Hezbollah drone strike near the Israeli Prime Minister’s private residence will not have helped to ease tensions."
"However, assuming no supply disruptions in the Middle East, the oil balance looks increasingly comfortable through 2025 with OPEC+ set to gradually bring 2.2m [barrels of oil per day] of supply back onto the market," he added.
Brent crude contracts for December delivery, the global pricing benchmark, were last seen $1.95 higher on the session at $76.24 per barrel, while WTI contracts for the same month rose $1.98 to $72.01 per barrel.
Updated at 10:53 AM EDT
GM revving ...
General Motors shares powered firmly higher, rising 7.2% to near three-year peak of $52.50 each, after the carmaker posted stronger-than-expected third quarter earnings and boosted its full-year profit forecast to between $12 billion and $14 billion.
The group also said it hopes to make EVs profitable over the coming years, and kept its capex spending largely in-line with last year's total.
"I’m proud that GM is delivering our best vehicles ever with strong financial results. But I want to be clear that we are not mistaking progress for winning," said CEO Mary Barra.
"Competition is fierce, and the regulatory environment will keep getting tougher," she added. "That’s why we are focused on optimizing our ICE margins and working to make our EVs profitable on an EBIT basis as quickly as possible."
$GM CFO Paul Jacobson joins to discuss the company's third quarter earnings, which beat estimates: pic.twitter.com/6CqHKjtytf
— Squawk Box (@SquawkCNBC) October 22, 2024
Updated at 9:41 AM EDT
Soft start
The S&P 500 was marked 27 points, or 0.47% lower in the opening minutes of trading, with the Nasdaq falling 100 points, or 0.54%.
The Dow was last marked 155 points lower while the mid-cap Russell 2000 index slipped 6 points, or 0.26%.
Treasury yields are easing a bit, with 10-years pegged at 4.174% and 2-year paper trading at 4.025%.
Main Index/ETF: Opening Bell Prices 📊
— Wealthonomic (@Wealthonomic1) October 22, 2024
🗓️ October 22, 2024
📊 S&P 500 $SPY: 581.01 (-0.38%)
🏛️ Dow Jones $DIA: 427.82 (-0.43%)
🤖 Nasdaq $QQQ: 492.88 (-0.55%)
🏬 Russell 2000 $IWM: 221.54 (-0.62%)
Markets opened in the red today, with all major indexes facing declines.… pic.twitter.com/cxrjO7uwLx
Updated at 9:15 AM EDT
On your bike
Peloton (PTON) shares are getting a boost from a report that the connected fitness group' is looking to grow its exercise bike sales through a tie-in with discount retail giant Costco COST.
CNBC said the partnership will see Costco selling the BIKE+ for $1,999 online, and $2,199 in-store, as the group seeks to attract younger and wealthier customers.
Peloton shares were marked 5.5% higher in premarket trading to indicate an opening bell price of $5.77 each.
$PTON $COST
— Momo Queen (@QueenofMOMO) October 22, 2024
Peloton partners with Costco to sell Bike+ as it looks to reach young, wealthy customers https://t.co/17OB9A3CW6
Updated at 8:18 AM EDT
Walmart delivers
Walmart (WMT) shares edged higher in early trading after the retail giant unveiled plans to launch a same-day pharmacy service delivery program from its 4,600 nationwide stores that include a pharmacy unit.
The move could prove to be another blow to companies such as CVS Health (CVS) and Walgreens (WBA) , which are closing stores and generating thinner profits amid a big shift in Medicare Advantage payouts.
“Helping customers solve missions is core to everything we do. By combining Pharmacy Delivery into a single order, we're strengthening our commitment to providing everything they need, whenever and wherever they need it,” said Tom Ward, executive vice president and chief eCommerce officer, Walmart U.S. “If you’re sick, we can deliver the necessary medicine along with everything else you need to feel better: cough drops, a heating pad, blanket and orange juice. Walmart’s size, resources and expertise set it apart from other retailers.”
Walmart shares were marked 0.12% higher at $80.91 each, while CVS slipped 0.1% and Walgreens fell 0.6%.
$WBA $CVS $WMT Walmart will start delivering prescriptions to customers’ doorsteps as CVS and Walgreens struggle https://t.co/FCP3rWj6Kj
— North Bluff Capital (@bluff_capital) October 22, 2024
Updated at 6:42 AM EDT
Lots of movers
A trio of earning hit the wires in premarket, with General Motors (GM) posting stronger-than-expected third quarter profits and issuing a robust near-term outlook, 3M topping Street forecasts and GE Aerospace posting mixed numbers with modestly light revenues.
General Motors shares were marked 2.9% higher in premarket trading at $50.35 each while rebounding 3M, which is up 48% for the year, added 2.35%. GE shares, meanwhile, slipped 1.15%.
$GM CFO: GM's average transaction price per vehicle, which Wall Street has been monitoring for signs of weakening, remained over $49,000 from July through Sept; The consumer has held up remarkably well for us; Nothing we see has changed from where we’ve been for the last several…
— TradeTheNews.com (@Trade_The_News) October 22, 2024
Stock Market Today
Stocks ended mixed on Monday, with a modest decline for the S&P 500, a larger pullback for the Dow Jones Industrial Average and a gain for the tech-focused Nasdaq as bond markets returned to their recent volatility.
Benchmark 10-year Treasury notes yields, which move in the opposite direction of prices, rose 11 basis points on the session, while adding another in overnight trading, and were last marked at a three month high of 4.208% heading into the New York session.
Merrill Lynch's MOVE index, which tracks fixed income volatility and is known as the 'VIX for bonds', is trading at the highest levels of the year and is up nearly 48.6% from its early July lows.
Messaging from Federal Reserve officials that suggested a slower pace of rate cuts, election uncertainty and the prospect of higher deficits regardless of who wins the White House and renewed inflation concerns tied to the outperforming economy have all combined to drive yields higher.
The moves are sapping risk sentiment in markets around the world, and driving the dollar index to multi-month highs against a basket of its global peers.
That's being played out in this mornings premarket session, where futures contracts tied to the S&P 500 suggest a 28 point pullback, with the Dow called 200 points lower and the Nasdaq poised of a 130 point decline.
Related: S&P 500 blows past bond market warnings
A heavy slate of earnings is expected throughout the session, with 3M (MMM) , GE Aerospace (GE) , Lockheed Martin (LMT) and Verizon (VZ) reporting before the opening bell and Texas Instruments (TXN) updating after the close.
In Europe, the Stoxx 600 was marked 0.38% lower in early Frankfurt trading, although software group SAP hit a fresh all-time high following stronger-than-expected third quarter earnings. Britain's FTSE 100 fell 0.64% in London.
More Wall Street Analysts:
- Analysts update Meta stock price target with Q3 earnings in focus
- Analysts update outlook for Nvidia's Blackwell chips amid AI boom
- Analyst reboots Reddit stock price target ahead of earnings
Overnight in Asia, Japan's Nikkei 225 fell 1.39% as investors took risk off the table ahead of this weekend's national elections and the yen weakened to 151, a three month low, against the U.S. dollar.
The regional MSCI ex-Japan benchmark, meanwhile, was marked 0.77% lower into the close of trading.
Related: Veteran fund manager sees world of pain coming for stocks
