Nasdaq bucks trend as Apple drags
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U.S. stocks are flirting with fresh records on Wednesday as investors cheered strong corporate results as they awaited the Federal Reserve's monetary policy decision. The market also largely shrugged off a delay in the unveiling of House Republicans' tax-cut plan.
What are stocks doing?
The S&P 500 climbed 5 points, or 0.2%, to 2,580, setting an intraday record at 2,588.40. Energy and health-care sectors were big gainers while telecom and utilities lagged behind.
Read:Wall Street's strong October suggests happy holidays ahead--and beyond (http://www.marketwatch.com/story/wall-streets-strong-october-suggests-happy-holidays-aheadand-beyond-2017-10-31)
Also see:Why the stock-market rally may be entering the FOMO stage (http://www.marketwatch.com/story/and-now-for-the-fomo-portion-of-the-stock-market-rally-2017-10-31)
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The Dow Jones Industrial Average rose 55 points, or 0.2%, to 23,432, also setting an intraday record of 23,517.71
The upbeat mood comes after U.S. stocks closed higher on Tuesday (http://www.marketwatch.com/story/nasdaq-ready-to-lead-us-stocks-up-end-october-on-a-high-note-2017-10-31), finishing out October on a positive note, with their biggest monthly percentage gains since February.
The Nasdaq Composite Index , however, bucked the trend to slip 14 points, o 0.2%, at 6,711, but the tech-laden index still touched an intraday record of 6,759.66 earlier.
Read:Here are the top 5 worries that could spook this monster stock rally (http://www.marketwatch.com/story/here-are-the-top-5-worries-that-could-spook-this-monster-stock-rally-2017-10-31)
What's driving the markets?
All eyes are on the Federal Reserve. The central bank is widely expected to keep rates on hold, but point to a December rate increase, when it announces its policy decision at 2 p.m. Eastern Time.
Read:Fed statement may have treats for both hawks and doves (http://www.marketwatch.com/story/fed-statement-may-have-treats-for-both-hawks-and-doves-2017-10-27)
The policy update, however, is likely to be overshadowed by speculation of who will become the next Fed chair. President Donald Trump is expected to name his pick on Thursday, with all indications so far pointing to current Fed Gov. Jerome Powell as the choice.
This earnings season has been strong, with 75% of the S&P companies that have reported so far beating earnings estimates, according to FactSet data.
Hopes for the passage of a tax package that includes corporate tax cuts has also provided support for investing in equities. The tax bill has been postponed to Thursday, from an expected release on Wednesday, (http://www.marketwatch.com/story/house-gop-delays-tax-bill-plans-to-keep-top-individual-rate-of-396-2017-10-31) to iron out unresolved issues.
Check out:8 most important things to know about the GOP tax plan (http://www.marketwatch.com/story/8-most-important-things-to-know-about-the-gop-tax-plan-2017-11-01)
Outside the U.S., traders welcomed the latest Caixin China manufacturing purchasing managers index reading, which showed factory activity in the world's second largest economy continued to expand at a steady pace in October (http://www.marketwatch.com/story/china-caixin-manufacturing-pmi-holds-steady-2017-10-31).
What are strategists saying?
"The market is going up because there is no reason for it not to go up: earnings are good, the global economic growth picture is good and there are expectations of a tax cut," said Joe Saluzzi, partner and co-head of equity trading at Themis Trading.
"The only thing that worries me is the fact that global growth is not reflected in bond yields, but that may also be due to low or negative rates elsewhere in sovereign bonds," Saluzzi added.
Which stocks are in focus?
Apple Inc.(AAPL) shares slid 1.2% after hitting records for two straight days. The iPhone maker is slated to release its quarterly results Thursday.
In another busy day on the earnings calendar, Estée Lauder Cos (http://www.marketwatch.com/story/estee-lauders-stock-rallies-after-revenue-beat-upbeat-outlook-2017-11-01).(EL) climbed 8% and Clorox Co (http://www.marketwatch.com/story/clorox-earnings-and-revenue-beat-estimates-2017-11-01).(CLX) added 1.7% after each beat revenue estimates.
New York Times Co.(NYT) reported earnings above expectations thanks to increase in digital subscriptions, but shares sank 5.4%.
Allergan PLC (AGN) gained 3.9% after it reported profit and revenue ahead of Wall Street forecasts.
Shares of United States Steel Corp.(X) jumped 7.8% after the steelmaker's quarterly results and outlook out late Tuesday topped Wall Street estimates (http://www.marketwatch.com/story/us-steel-shares-rally-on-earnings-beat-outlook-2017-10-31).
Electronic Arts Inc.(EA) dropped 4.4% after the videogame maker reported a second-quarter loss (http://www.marketwatch.com/story/electronic-arts-shares-drop-in-the-extended-session-after-second-quarter-results-2017-10-31) after Tuesday's closing bell.
Envision Healthcare Corp.(EVHC) tumbled 32% after hospital company late Tuesday revealed weaker than expected earnings and said it would review strategic alternatives (http://www.marketwatch.com/story/envision-healthcare-plummets-after-earnings-miss-may-consider-sale-2017-10-31) that could include a sale.
After the market closes, Facebook Inc.(FB), Tesla Inc.(TSLA) and Kraft Heinz Co.(KHC) are on the docket. Qualcomm Inc.(QCOM), MetLife Inc.(MET) and Allstate Corp.(ALL) are also expected to release earnings after hours.
Read:Tesla earnings--Model 3 production, demand under the microscope (http://www.marketwatch.com/story/tesla-earnings-model-3-production-demand-under-the-microscope-again-2017-10-25)
And see:EarningsWatch: Apple, Tesla and Facebook are post-Halloween treats (http://www.marketwatch.com/story/earningswatch-apple-tesla-and-facebook-are-post-halloween-treats-2017-10-30)
What economic data are in focus?
Private-sector employment bounced back in October as employers added 235,000 jobs (http://www.marketwatch.com/story/adp-says-235000-jobs-added-in-october-2017-11-01), ADP reported Wednesday.
The Markit manufacturing PMI for the same month came in at 54.6. The ISM manufacturing index fell to 58.7% in October, slightly below forecasts, but still indicated robust growth.
See:Manufacturers still growing like gangbusters, ISM finds (http://www.marketwatch.com/story/manufacturers-still-growing-like-gangbusters-ism-finds-2017-11-01)
What are other markets doing?
Oil prices is flat after rallying (http://www.marketwatch.com/story/us-oil-jumps-to-2-year-high-on-signs-opec-deal-is-working-2017-11-01) on optimism that the OPEC deal to cut production is working while gold also rose to trade 0.6% higher.
The dollar traded mixed (http://www.marketwatch.com/story/dollar-edges-up-as-fed-decision-comes-on-deck-2017-11-01) against other major currencies, with the ICE Dollar Index up 0.2%.
Stocks in Asia closed firmly higher (http://www.marketwatch.com/story/nikkei-kospi-jump-more-than-1-to-lead-asia-pacific-stock-gains-2017-10-31), and European markets (http://www.marketwatch.com/story/european-stocks-leap-to-2-year-high-as-commodity-shares-march-up-2017-11-01) mirrored the same mood.
The yield on the 10-year Treasury note (http://www.marketwatch.com/story/treasury-yields-tip-higher-as-global-equities-climb-fed-policy-update-looms-2017-11-01) fell 2 basis points to 2.36%.
--Sara Sjolin contributed to this article.
(END) Dow Jones Newswires
November 01, 2017 13:12 ET (17:12 GMT)