The Nasdaq rose as Tesla posted strong profits

Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., June 30, 2022. REUTERS/Brendan McDermid/File Photo

Join now for FREE unlimited access to Reuters.com

  • Tesla shares rise as earnings beat expectations
  • Energy stocks lead sector declines
  • AT&T drags down the communication services sector
  • Mixed indices: Dow up 0.08%, S&P 500 up 0.62%, Nasdaq up 1.07%

July 21 (Reuters) – The Nasdaq edged higher on Thursday, boosted by gains in electric carmaker Tesla on its better-than-expected quarterly results, which helped offset a decline in telecoms and energy stocks.

The S&P 500 gained 0.6% after an earlier decline, and the Dow Jones Industrial Average was flat early in the afternoon.

Tesla (TSLA.O) jumped 10.1%, while AT&T Inc (TN) fell to drag telecommunications stocks lower after the mobile operator cut its cash forecast, saying some subscribers delayed the payment of invoices. Energy stocks slid on weak crude prices. Read more

Join now for FREE unlimited access to Reuters.com

Tesla’s profit benefited from higher prices for its cars, offsetting production problems. Strong reports from the automaker and streaming giant Netflix Inc (NFLX.O) boosted megacap growth stocks that came under pressure from rising interest rates.

“The earnings picture may have been a little better than investors feared,” said J. Bryant Evans, investment adviser and portfolio manager at Cozad Asset Management. and maybe there are assessment opportunities there.

Seven of the 11 major S&P 500 sectors are in positive territory, with Consumer Discretionary (.SPLRCD), Health Care (.SPXHC) and Information Technology (.SPLRCT) posting the biggest gains with more than 1 % each.

Falling oil prices hit the S&P 500 (.SPNY) energy sector, which shed 2.8% to lead declines.

All eyes are on the Federal Reserve meeting next week where policymakers are expected to raise interest rates by 75 basis points.

Rising inflation also led the European Central Bank to late join its global counterparts in a rate hike cycle with an aggressive 50 basis point hike. Read more

Next week’s Fed rate decision will be followed by crucial second quarter US gross domestic product data, which is again expected to be negative.

A common rule of thumb is that two quarters of negative GDP growth would mean the US is in a recession. Read more

In the latest signs of a slowing US economy, the number of Americans filing for unemployment benefits hit its highest level in eight months and a closely watched indicator of factory activity slumped this month -this. Read more

“Consumers are just starting to react to less money in their pockets, either because of a tight overall labor market or because of rising interest rates and inflation,” Evans added. .

“Some of the strong earnings reflect past consumer strength, while much of this broader decline we’ve seen.. over the past few months factored in a slowdown in the broader economy that would end by affecting consumers.”

As of 2:24 p.m. ET, the Dow Jones Industrial Average (.DJI) rose 25.94 points, or 0.08%, to 31,900.78, the S&P 500 (.SPX) gained 24.59 points, or 0.62%, to 3,984.49 and the Nasdaq Composite (.IXIC) added 127.19 points, or 1.07%, to 12,024.84.

Advancing issues outnumbered declining ones on the NYSE by a ratio of 1.15 to 1; on the Nasdaq, a ratio of 1.20 to 1 favored advancers.

The S&P 500 posted 1 new 52-week high and 29 new lows; the Nasdaq Composite recorded 17 new highs and 38 new lows.

Join now for FREE unlimited access to Reuters.com

Reporting by Echo Wang in New York; Additional reporting by Shreyashi Sanyal and Aniruddha Ghosh in Bengaluru; Editing by Aurora Ellis

Our standards: The Thomson Reuters Trust Principles.

Leave a Comment