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Stock Market News for Nov 1, 2021

Wall Street closed higher on Friday despite weak earnings results of a couple of technology behemoths.

This story originally appeared on Zacks

Wall Street closed higher on Friday despite weak earnings results of a couple of technology behemoths. Overall, the third-quarter 2021 earnings season is highly encouraging so far that have bolstered market participants’ confidence on U.S. equities. The three major stock indexes ended in green. Moreover, for the week and the month as a whole, these indexes finished in positive territory.

- Zacks

How Did The Benchmarks Perform?

The Dow Jones Industrial Average (DJI) rose 0.3% to close at 35,819.56, marking its all-time closing high. Notably, 16 components of the 30-stock index ended in the green while 14 in red.  

The tech-heavy Nasdaq Composite finished at 15,498.39, gaining 0.3% due to strong performance by large-cap technology stocks. This marked the tech-laden index’s new closing high. In intraday trading, the index recorded a fresh all-time high of 15,504.12.

Meanwhile, the S&P 500 increased 0.2% to end at 4,605.38. This marked the broad-market index’s new closing high. In intraday trading, the index registered a fresh all-time high of 4,608.08. Five out of eleven sectors of the benchmark index closed in positive territory and six in red. The Health Care Select Sector SPDR (XLV) gained 1% while the Real Estate Select Sector SPDR (XLRE) fell 1.2%.

The fear-gauge CBOE Volatility Index (VIX) was down 1.6% to 16.26. A total of 11.12 billion shares were traded on Friday, higher than the last 20-session average of 10.35 billion. Decliners outnumbered advancers on the NYSE by a 1.14-to-1 ratio. On Nasdaq, a 1.02-to-1 ratio favored advancing issues.

Markets Ignore Big Tech’s Earnings Miss

On Oct 28, after the closing bell, Apple Inc. AAPL reported fourth-quarter fiscal 2021 earnings of $1.24 per share that was in line with the Zacks Consensus Estimate. However, net sales of $83.36 billion, lagged the Zacks Consensus Estimate by 2.5%.

Apple carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Inc. AMZN reported third-quarter 2021 earnings of $6.12 per share, missing the Zacks Consensus Estimate by 29.7%. Net sales of $110.81 billion also missed the Zacks Consensus Estimate of $111.83 billion.

On the other hand, there are some positive news for investors. The FDA approved the COVID-19 vaccine developed by Pfizer inc. PFE and BioNTech SE BNTX for children ages 5 to 11. More than 28 million U.S. kids will now get vaccine.

On Oct 28, President Joe Biden announced that he had reached a deal with Senate Democrats on the outlines of a $1.75 trillion social spending and climate bill. He appealed to House Democrats to vote for the stalled $1 trillion infrastructure bill that has already passed the Senate.

Economic Data

The Department of Commerce reported that the personal consumption expenditure (PCE) price index rose 0.3% in September. August’s data was revised upward from 0.4% to 0.6%. Year over year, PCE inflation rose 4.4%, marking the fastest pace since January 1991.

The core PCE (excluding volatile food and energy items) price index increased 0.2% in September, in line with the consensus estimate but below August’s data of 0.3%. The core PCE inflation – Fed’s favorite gauge of inflation – climbed 3.6% year over year, its highest since May 1991.

Personal income dropped 1% in September compared with the consensus estimate of a decline of 0.2% and August’s data of an increase of 0.2%. Personal spending increased 0.6% in September compared with the consensus estimate of 0.5%. August’s data was revised upward from an increase of 0.8% to 1%. Personal savings rate slid to 7.5% in September compared with a downwardly revised 9.2% in August.

The employment cost index surged to 1.3% in third-quarter 2021 compared with 0.7% in the second quarter. The consensus estimate was 0.9%. Year over year, the employment cost index climbed 3.7% in the third quarter, marking the fastest acceleration since the second quarter of 2002.

The University of Michigan reported that the U.S. consumer sentiment index rose to 71.7% in the final reading of October from 71.4% in the preliminary reading. The consensus estimate was 71.5%. The final reading of September was 72.8%. The sub-index for current conditions fell to 77.7% in October from 80.1% in September, while sub-index for expectations slipped to 67.9% in October from 68.1% in September.

Weekly Roundup

Last week was a good one for Wall Street. The three major stock indexes – the Dow, the S&P 500 and the Nasdaq Composite – gained 0.4%, 1.3% and 2.7%, respectively. Strong third quarter earnings results lifted investors’ confidence. Moreover, the yield of the benchmark 10-Year U.S. Treasury Note dropped to 1.56% from 1.67% a week ago.

Monthly Roundup

Wall Street had a fabulous October this year. The Dow, the S&P 500 and the Nasdaq Composite have rallied 5.8%, 6.9% and 7.3%, respectively. The S&P 500 and the Nasdaq Composite recorded best month since November 2020 while the Dow registered best month since March 2021.

Impressive third quarter earnings results and a slew of solid economic data reaffirmed U.S. economic recovery that helped U.S. stock markets more than offset September’s losses.

Infrastructure Stock Boom to Sweep America

A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made.

The only question is “Will you get into the right stocks early when their growth potential is greatest?”

Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.

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