Caterpillar, McDonald's among Dow's biggest gainers of the day
The S&P 500 and the Nasdaq closed at records Tuesday, while the Dow industrials posted gains, following better-than-expected results from a number of high-profile companies.
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The Dow Jones Industrial Average rose 100.46 points, or 0.5%, to close at 21,613.43. Leading the Dow higher were shares of Caterpillar Inc.(CAT), which finished up 5.9% after its earnings surged past expectations (http://www.marketwatch.com/story/caterpillar-stock-jumps-45-premarket-after-earnings-blow-past-estimates-2017-07-25) and it also raised its outlook. McDonald's Corp. (MCD) posted earnings and sales that topped consensus forecasts (http://www.marketwatch.com/story/mcdonalds-shares-rise-after-earnings-revenue-beat-estimates-2017-07-25), sending shares 4.8% higher.
The S&P 500 rose 7.17 points, or 0.3%, to finish at a record 2,477.08, hitting an all-time high of 2,481.24, led by 1.3% gains in both energy and financial shares.
The Nasdaq Composite Index rose 1.37 points to close at a record 6,412.17, after reaching an intraday record of 6,425.45, even as shares of Alphabet Inc. (GOOGL) (GOOGL) fell 3% following better-than-expected quarterly results (http://www.marketwatch.com/story/alphabet-reports-second-quarter-earnings-beat-2017-07-24) but also record traffic acquisition costs (http://www.marketwatch.com/story/alphabets-latest-quarter-looks-tacky-due-to-google-parents-traffic-acquisition-costs-2017-07-25).
Read more:Alphabet earnings keep Google investors in dark (http://www.marketwatch.com/story/alphabet-earnings-keep-google-investors-in-dark-2017-07-24)
Recent gains have been driven by the earnings season, and S&P 500 companies are on track to report earnings growth of 7.2%, along with average revenue growth of 5%. So far, more than 70% of firms that have reported beat earnings or sales expectations, according to FactSet.
"There's been a mixed message but in general companies are coming in a little bit better and sounding better, and essentially central banks are pretty accommodative so the bull play is still pretty much in place and people are adding exposure to equities," said Ian Winer, head of the equities division at Wedbush Securities.
A jump in oil prices isn't hurting stocks, either, Winer said.
Oil futures (http://www.marketwatch.com/story/oil-continues-to-gain-as-opec-raises-hopes-of-market-rebalancing-2017-07-25) jumped 3.2% to settle at $47.89 a barrel after Saudi Arabia and Nigeria pledged to pull back on exports and limit output.
See:Why oil prices just scored the biggest one-day rally of 2017 (http://www.marketwatch.com/story/why-oil-prices-scored-their-biggest-one-day-rally-of-2017-2017-07-25)
"By most measures, this is a season where companies are surprising to the upside, and that's a key driver for equity prices," said Terry Sandven, chief equity strategist at U.S. Bank Wealth Management. "We know valuations are full, but we're cautiously optimistic because earnings are increasing and the Federal Reserve remains accommodative. That's a favorable backdrop for equities."
Individual movers:3M Co. (MMM), another in the group of Dow components reporting results on Tuesday, fell 5.1% after its second-quarter revenue missed expectations (http://www.marketwatch.com/story/shares-of-3m-slide-15-after-company-reports-q2-revenue-below-expectations-2017-07-25).
Freeport-McMoRan Inc. (FCX) added 15% after it swung to a second-quarter profit (http://www.marketwatch.com/story/freeport-mcmoran-shares-gain-2-after-company-swings-to-a-profit-in-q2-2017-07-25).
TechnipFMC(FTI.FR) (FTI.FR) fell 1.7% after the provider of oil-field services said it would restate some of its previous results (http://www.technipfmc.com/en/media/press-releases/technipfmc-plc-restatement-of-the-unaudited-interim-condensed-consolidated-financial-information-as) because of material errors.
Biogen(BIIB) fell 0.6%, erasing an earlier gain that came after the biotech giant posted stronger-than-anticipated earnings (http://www.marketwatch.com/story/biogen-stock-surges-nearly-6-on-q2-profit-revenue-beats-2017-07-25) and raised its full-year profit guidance.
Apparel and accessories seller Michael Kors Holdings Ltd.(KORS) finished up less than 0.1% after it agreed to acquire upscale shoemaker Jimmy Choo PLC(CHOO.LN) in a $1.2 billion deal (http://www.marketwatch.com/story/michael-kors-buying-shoe-maker-jimmy-choo-for-12-billion-in-all-cash-deal-2017-07-25). Shares of Jimmy Choo surged 17%.
General Motors Co.(GM) reported a sharp drop in profits (http://www.marketwatch.com/story/gms-profit-falls-on-sale-of-europe-business-2017-07-25), a decline related to the sale of its European business and one-time charges linked to the company's exit from some Asian markets. Shares of GM declined 0.7%.
Don't miss:Here's a sign investors are viewing earnings through rose-tinted glasses (http://www.marketwatch.com/story/heres-a-sign-investors-are-viewing-earnings-through-rose-tinted-glasses-2017-07-24)
Economic news: U.S. home-price growth eased slightly but remained healthy (http://www.marketwatch.com/story/home-price-growth-stays-strong-and-the-west-is-still-the-best-case-shiller-says-2017-07-25) as demand outweighs supply throughout the housing market. The S&P/Case-Shiller 20-city index rose 5.7% in the three-month period ending in May compared with a year ago, down from 5.8% in the prior period.
A read on consumer confidence came in at 121.1 in July, the second-highest level for the index since 2000.
Check out:MarketWatch's Economic Calendar (http://www.marketwatch.com/economy-politics/calendars/economic)
The Federal Reserve's two-day policy meeting is due to kick off Tuesday, with the resulting policy announcement due Wednesday (http://www.marketwatch.com/story/no-retreat-fed-to-stick-to-plans-for-rate-hike-balance-sheet-selloff-this-year-2017-07-24).
"While no change in policy is expected and no press conference is taking place, with the central bank believed to be preparing measures to reduce the balance sheet from September, there may be hints at such a move in the statement," said Craig Erlam, senior market analyst at Oanda, in a note.
Other markets: European stocks rose as a survey showed German business sentiment (http://www.marketwatch.com/story/european-stocks-march-higher-as-german-businesses-take-euphoric-tone-2017-07-25) at a "euphoric" level. Asian markets closed mixed. Gold futures (http://www.marketwatch.com/story/gold-rally-stalls-bucks-weaker-dollar-boost-ahead-of-fed-update-2017-07-25) declined 0.2% to settle at $1,252.10 an ounce, and a key dollar index ticked 0.1% higher.
--Victor Reklaitis in London contributed to this report
(END) Dow Jones Newswires
July 25, 2017 16:23 ET (20:23 GMT)