Wall Street closes higher ahead of megacap earnings, election

Wall Street closed higher on Monday ahead of a packed week of earnings from megacap companies and the final stretch before the Nov. 5 presidential election, while sentiment improved after energy supplies were not disrupted by weekend developments in the Middle East.

Israel’s response over the weekend to an Iranian missile attack this month focused, so far, on missile factories and other sites near Tehran, rather than on refineries or nuclear targets.

Wall Street was focused on the week ahead, notably corporate results, with around 169 S&P 500 companies scheduled to report through the week.

That includes the bulk of the “Magnificent Seven” group of megacap technology stocks that have driven Wall Street to all-time highs. Alphabet, Meta Platforms and Apple rose ahead of results this week.

The S&P 500 gained 15.4 points, or 0.27%, to 5,823.52, while the Nasdaq Composite gained 48.58 points, or 0.26%, to 18,567.19. The Dow Jones Industrial Average rose 273.17 points, or 0.65%, to 42,387.57

Last week, Nvidia surpassed Apple as the world’s most valuable company. Investors will look out for AI spending guidance in tech earnings this week.

“The earnings will be important for the guidance that the companies give as to what sort of capital expenditure programs they may implement in the coming year,” said Paul Christopher, head of Global Investment Strategy at Wells Fargo Investment Institute.

Microsoft and Amazon.com also report earnings this week.

The small-cap Russell 2000 jumped 1.63% today, outperforming major indexes.

“This could be the market looking ahead to a soft landing and expecting small caps to be first out of the gate as they typically are,” Christopher said. “It could also be some element related to the Trump trade but it’s very difficult to disentangle those two.”

The energy sector fell 0.65% as crude prices plunged 5% on easing supply worries, while financial company shares led sectoral gains.

Advancing issues outnumbered decliners by a 1.88-to-1 ratio on the NYSE. There were 147 new highs and 41 new lows on the NYSE.

The S&P 500 posted 15 new 52-week highs and 2 new lows while the Nasdaq Composite recorded 101 new highs and 67 new lows.

Economic data due this week will be crucial for assessment of Federal Reserve policy, most notably Thursday’s Personal Consumption Expenditure Price Index, the Fed’s preferred inflation gauge.

Focus will also be on the U.S. presidential election, with markets more broadly pricing in a second Donald Trump administration, though the election is expected to be close.

Boeing’s shares dipped 2.8% after the plane maker launched a stock offering that could raise up to USD 22 billion in a bid to shore up its finances amid an ongoing worker strike.

Industrial conglomerate 3M jumped 4.4%, giving a boost to the Dow, after JP Morgan hiked its price target on the company’s shares.

(Reporting by Abigail Summerville in New York; Editing by David Gregorio)