Wall Street indexes were mixed on Tuesday as investors searched for direction amid a flurry of earnings reports from corporate heavyweights, following a tech-led rally in the previous session.
While the results season shifted into high gear, analysts caution that stretched equity valuations and indexes near record highs may limit the rally’s sustainability, suggesting that strong earnings alone would not suffice unless companies also demonstrate margin resilience and offer robust forecasts.
“It could disappoint investors if companies don’t actually beat the estimates by a large amount, even though these estimates are already huge,” said Daniela Hathorn, senior market analyst at Capital.com.
“Clearly there’s no desire to be a seller right now because everyone’s expecting the earnings season to be good.”
At 09:38 a.m., the Dow Jones Industrial Average rose 22.28 points, or 0.05%, to 46,728.86. The S&P 500 gained 4.15 points, or 0.06%, to 6,739.28, while the Nasdaq Composite lost 15.57 points, or 0.07%, to 22,974.97.
General Motors shares revved up 12% after a brighter tariff outlook helped the automaker raise its full-year forecast.
Peer Ford cruised 2% higher ahead of results on Thursday.
In consumer staples, Coca-Cola gained 3.5%, refreshing investor sentiment with a third-quarter beat, driven by unwavering demand for its sodas.
Philip Morris dropped 6.5% after its results.
In the defense sector, GE Aerospace climbed 2.2% after raising full-year profit forecast. RTX too, bumped up forecasts for the year, sending its shares surging 10.5%.
Northrop Grumman slipped 2.2% after trimming sales projection, while Lockheed Martin LMT was marginally lower.
Industrial stocks added 0.4%, while the S&P Aerospace and Defense index advanced 2.2%.
This week’s earnings lineup also includes heavyweights such as IBM, Procter & Gamble and Intel. Netflix slipped 0.2% ahead of its results due after the market close on Tuesday.
Regional bank earnings will be monitored to get a closer read on the sector’s health after fears of systemic stress sparked a selloff last week.
Meanwhile, Warner Bros Discovery said it was considering an outright sale following interest from several potential buyers, sending the media conglomerate’s shares soaring 11.5%.
Sentiment improved after White House economic adviser Kevin Hassett said on Monday the U.S. government shutdown was likely to end this week.
U.S. President Donald Trump also struck a positive tone on trade, saying he expects to reach a “fair deal” with Chinese President Xi Jinping, while downplaying tensions over Taiwan.
Markets will keep an eye on Trump’s upcoming meeting with Xi on the sidelines of next week’s economic summit in South Korea.
Declining issues outnumbered advancers by a 1.28-to-1 ratio on the NYSE and by a 1.67-to-1 ratio on the Nasdaq.
The S&P 500 posted 13 new 52-week highs and no new lows, while the Nasdaq Composite recorded 21 new highs and 25 new lows.
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