Wall St ends higher; investors await earnings, signals Fed

  • Alphabet shares fall on report Samsung may dump Google search
  • State Street slips on profits in the first quarter
  • New York factory activity picks up in April – NY Fed
  • Indexes up: Dow 0.3%, S&P 0.33%, Nasdaq 0.28%

April 17 (Reuters) – Major U.S. stock indexes posted modest gains on Monday, helped by financials and industrial stocks, as investors braced for a heavy week of corporate earnings and comments from Federal Reserve officials that could provide more insight into the path of interest rates. .

Markets are gauging the health of corporate profits and the economy after several banks started reporting strong first-quarter results last week.

Meanwhile, the New York Fed said on Monday that a barometer of manufacturing activity in New York state rose for the first time in five months in April, helping to strengthen the case for the US central bank to raise interest rates at its meeting next month.

“The markets are in a bit of a wait-and-see mode,” said Angelo Kourkafas, an investment strategist at Edward Jones. “We have a lot of corporate earnings ahead of us and the Fed rate decision in a couple of weeks.”

The Dow Jones Industrial Average (.DJI) rose 100.71 points, or 0.3%, to 33,987.18; The S&P 500 (.SPX) gained 13.68 points, or 0.33%, to 4,151.32; and the Nasdaq Composite (.IXIC) added 34.26 points, or 0.28%, to 12,157.72.

Among S&P 500 sectors, financials (.SPSY) rose 1.1%, industrials (.SPLRCI) rose 0.8% while the lower-weighted real estate group (.SPLRCR) added 2.2%. Energy (.SPNY) fell 1.3%.

Shares of Google parent Alphabet Inc ( GOOGL.O ) fell 2.7%, weighing on the S&P 500 and Nasdaq, after a report that South Korea’s Samsung Electronics ( 005930.KS ) was considering replacing Google with Microsoft-owned ( MSFT .O) Bing as the default search engine on their devices.

Investors await more reports from major U.S. banks this week, including Goldman Sachs Group Inc ( GS.N ), Bank of America Corp ( BAC.N ) and Morgan Stanley ( MS.N ), after heavyweights including JP Morgan Chase & Co ( JPM.N) reaped windfall from higher interest payments last week.

Other companies due to report this week include Johnson & Johnson ( JNJ.N ), Tesla Inc ( TSLA.O ) and Netflix Inc ( NFLX.O ).

The S&P 500 company’s revenue is expected to have fallen 4.8% in the first quarter from the same period last year, according to Refinitiv IBES data.

“Corporate earnings are emerging as the big driver of what the market is likely to do in the near term, and investors want to see how they play out here before placing bets,” said Chuck Carlson, CEO of Horizon Investment Services in Hammond, Indiana.

Investors are also trying to gauge the outlook from executives after a banking crisis last month that some expect could accelerate an economic slowdown.

US Treasury yields rose on Monday, with a series of Fed speakers expected later in the week. The US central bank is widely seen to raise interest rates by 25 basis points to a range of 5%-5.25% next month.

In company news, shares of State Street Corp ( STT.N ) fell 9.2% after the financial services provider’s quarterly results missed analysts’ estimates, hurt by a drop in fee income.

Advancing issues outnumbered decliners on the NYSE by a ratio of 1.42 to 1; on the Nasdaq, a ratio of 1.61 to 1 favored advances.

S&P 500 posted 15 new 52-week highs and one new low; The Nasdaq Composite registered 70 new highs and 158 new lows.

About 10 billion shares changed hands on US exchanges, compared to the 10.8 billion daily average over the past 20 sessions.

Reporting by Sruthi Shankar in Bengaluru; Editing by Shounak Dasgupta

Our standards: Thomson Reuters Trust Principles.

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