Consumer goods companies help lift stocks
Stocks shook off an early wobble Tuesday on Wall Street, finishing modestly higher and extending the market’s gains into a fourth week.
Solid earnings from Walmart encouraged investors to bid up other retailers and consumer goods companies. Communication services stocks and banks also contributed to the broad gains.
Homebuilders also notched gains following an industry survey showing improved confidence among builders heading into the key spring homebuying season.
Roughly 81 percent of S&P 500 companies have reported results for the last three months of 2018, delivering earnings growth of 13.1 percent versus a year earlier, according to FactSet. First-quarter snapshots are expected to result in a 2.5 percent decline in earnings, however.
Even so, the strong quarterly performance from the world’s largest retailer was an encouraging signal on U.S. consumer spending after a government report last week showed retail sales slumped in December.
“Now that we’re winding down on earnings, investors are looking forward to what’s going to move the market higher,” said Karyn Cavanaugh, senior markets strategist at Voya Investment Management. “The fact that the consumer is still strong is a comfort to investors.”
The benchmark S&P 500 index, which has risen for the past three weeks, gained 4.16 points, or 0.1 percent, to 2,779.76.
The Dow Jones Industrial Average rose 8.07 points, or 0.03 percent, to 25,891.32. The Nasdaq composite added 14.36 points, or 0.2 percent, to 7,486.77. The Russell 2000 index of smaller companies picked up 5.22 points, or 0.3 percent, to 1,574.47.
Major European indexes finished mostly lower.
U.S. stock indexes got off to a downbeat start Tuesday as U.S. markets reopened following the Presidents Day holiday. They wavered between small gains and losses for most of the morning, then veered higher in late morning trading and held on to most of their gains the rest of the day.
London-based bank HSBC and oil and gas rig operator Transocean declined after both companies reported quarterly results that fell short of Wall Street analysts’ forecasts. HSBC fell 3.1 percent and Transocean lost 2.2 percent.
But Walmart’s results helped lift the market.
The retailer rose 2.2 percent after its quarterly earnings beat forecasts. Walmart benefited from growth in online sales and the expansion of its grocery pickup and delivery business. Amazon gained 1.2 percent, while Target added 1.5 percent.
The latest round of company earnings showed solid profit growth for the final three months of 2018, but caution about conditions going forward amid signs of a weaker global economy this year. Europe and China have both reported slower growth.