Wall Street climbs as Apple, bank stocks jump

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., January 25, 2022. REUTERS/Brendan McDermid/File Photo/File Photo

Feb 8 (Reuters) – U.S. stock indexes climbed on Tuesday, boosted by Apple and Microsoft, while a jump in Treasury yields lifted banking stocks ahead of a key inflation readingthis week.

After spending most of the morning session in the red, the benchmark S&P 500 and the tech-heavy Nasdaq reversed course, powered by Apple (AAPL.O), Microsoft (MSFT.O) and Amazon.com Inc , which gained between 1.5% and 2%.

Meanwhile, the S&P 500 banking index (.SPXBK) jumped 1.7% as the benchmark 10-year U.S. Treasury yield hit its highest level since November 2019 amid growing expectations that the U.S. Federal Reserve will start tightening monetary policy.

Shares of Bank of America Corp (BAC.N), JPMorgan Chase & Co (JPM.N) and Wells Fargo gained about 2% each.

U.S. consumer prices data, set to be released on Thursday, is forecast at a four-decade high of 7.3%. The numbers follow strong U.S. labor data last week that raised investor concerns that the Fed will tighten rates faster than thought.

“We’ve got a rising interest rate environment which we haven’t seen since 2018 and there are a lot of investors in high growth names that continue to see weakness,” said Dennis Dick, a trader at Bright Trading LLC in Las Vegas.

“You’re going to see money rotate to lower multiple names and more value-oriented market.”

Concerns around aggressive policy tightening by the U.S. central bank, geopolitical tensions in Ukraine and a mixed bag of results from Big Tech have weighed on the major U.S. indexes since the start of the year.

The S&P 500 is down 5.3% so far this year and is trading 6.3% below its January record levels.

Earnings were mixed on Tuesday, with Pfizer Inc (PFE.N) down 2.7% after the drugmaker’s full-year sales forecast for its COVID-19 vaccine and antiviral pills fell short of estimates. Amgen Inc (AMGN.O) surged 8.4% after announcing a buyback of up to $6 billion and forecasting earnings to more than double by 2030. read more

Facebook-owner Meta Platforms (FB.O) fell 1.6% after billionaire investor Peter Thiel decided to step down from the company’s board, driving a fourth day of losses in the stock after its bleak forecast wiped out billions of dollars in market value last week. read more

At 12:34 p.m. ET, the Dow Jones Industrial Average (.DJI) was up 323.57 points, or 0.92%, at 35,414.70, the S&P 500 (.SPX) was up 34.70 points, or 0.77%, at 4,518.57, and the Nasdaq Composite (.IXIC) was up 162.26 points, or 1.16%, at 14,177.93.

Peloton Interactive Inc (PTON.O) gained 32.6% despite slashing its revenue forecast as the exercise bike maker said it would replace its chief executive officer and cut jobs in a bid to revive sagging sales. [nL4N2UJ2G4]

Coty Inc (COTY.N) gained 7.3% after raising its earnings forecast for 2022. read more

Of the 298 companies in the S&P 500 that reported earnings so far, 77.9% beat analysts’ profit expectations, compared with an average of 84% over the past four quarters, according to Refinitiv data.

Advancing issues outnumbered decliners by a 1.64-to-1 ratio on the NYSE and a 1.66-to-1 ratio on the Nasdaq.

The S&P index recorded 24 new 52-week highs and four new lows, while the Nasdaq recorded 47 new highs and 87 new lows.

Reporting by Bansari Mayur Kamdar in Bengaluru; Editing by Maju Samuel

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