Stocks Gain as Traders Brush Off Big Tech Earnings: Markets Wrap

(Bloomberg) -- U.S. stocks rose  Friday as traders weighed disappointing earnings and bond-market gyrations amid concerns over inflation and monetary tightening. 

The S&P 500 gained 0.2% after opening lower on underwhelming results from Amazon.com Inc. and Apple Inc. The gains brought the benchmark index up 6.9% for October, it biggest monthly increase since last November. Meanwhile, the Nasdaq 100 pushed 0.5% higher, offset by gains in Tesla Inc. as well as Meta Platforms Inc. after its name change from Facebook Inc. 

“It looks like investors already have a bit of a sugar high as Halloween approaches,” said Adam Phillips, managing director of portfolio strategy at EP Wealth Advisors. “Most of us were prepared for a bumpy ride today following yesterday’s announcements from Apple and Amazon. Fortunately, today’s positive reports from companies like Exxon and Chevron helped change the narrative.”

Elsewhere, inflation pressures and the prospect of interest-rate hikes whipsawed bond markets. The yield on the U.S. 10-year Treasury fell to 1.55% after earlier gains. And in Europe, bonds extended a retreat after data on Eurozone economic growth and inflation topped analysts’ estimates, reinforcing a growing conviction interest-rate increases are on the horizon after only a mild pushback from the leader of the European Central Bank.  

Markets are grappling with a number of crosscurrents. Generally positive corporate performance has helped to underpin global equities. But inflation risks from supply-chain snarls and costlier raw materials are boosting expectations for rate hikes and dimming the economic outlook.

“Almost any data series you look at, be it the bond market, be it inflation, GDP, the labor market, anything is still showing these signs of fibrillation and that’s going to take some time to sort out,” said Scott Clemons, chief investment strategist at Brown Brothers Harriman, on Bloomberg Radio and TV’s “Surveillance.”   

The latest GDP data in the U.S. showed growth slowed more than expected in the third quarter, hampered by supply chains and a surge in Covid-19 cases. A separate report showed that weekly jobless claims fell to a pandemic low, and personal spending slowed in line with analysts’ estimates in September.

The Stoxx Europe 600 Index erased losses, but still secured its fourth straight weekly advance. The U.S. dollar strengthened. Crude oil gained.

In cryptocurrencies, Bitcoin rose to $62,300 and Ether rallied to a record high.

For more market analysis, read our MLIV blog.

Stocks

• The S&P 500 rose 0.2% as of 4 p.m. New York time
• The Nasdaq 100 rose 0.5%
• The Dow Jones Industrial Average rose 0.2%
• The MSCI World index fell 0.3%

Currencies

• The Bloomberg Dollar Spot Index rose 0.7%
• The euro fell 1% to $1.1559
• The British pound fell 0.8% to $1.3684
• The Japanese yen fell 0.4% to 113.98 per dollar

Bonds

• The yield on 10-year Treasuries declined two basis points to 1.56%
• Germany’s 10-year yield advanced three basis points to -0.11%
• Britain’s 10-year yield advanced three basis points to 1.03%

Commodities

• West Texas Intermediate crude rose 0.6% to $83.33 a barrel
• Gold futures fell 1% to $1,784.70 an ounce

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