Stock market today: Wall Street builds on its winning week following stronger profit reports

Jul 13, 2023, 11:20 PM | Updated: Jul 14, 2023, 7:01 am

NEW YORK (AP) — Stocks are ticking higher Friday following stronger profit reports than expected from several financial giants, keeping Wall Street on pace for another winning week.

The S&P 500 was 0.3% higher in early trading, coming off its highest close since April 2022. The Dow Jones Industrial Average was up 159 points, or 0.4%, at 34,545, as of 9:40 a.m. Eastern time, and the Nasdaq composite was 0.4% higher.

Banks were a focal point of the day after a gaggle of them helped kick off the earnings reporting season.

Wells Fargo rose 2.2% after it also reported stronger profit for the second quarter than expected.

Insurance giant UnitedHealth Group rallied 4.8 % after it said profit growth during the spring was better than feared. It also raised the bottom end of its forecast for earnings for the full year.

On the losing end was State Street, which fell 4.3% after reporting slightly weaker revenue than expected for the latest quarter, though its profit topped forecasts.

The earnings reporting season is just getting underway, and Wall Street’s expectations are low. Analysts are forecasting the worst drop in earnings per share for S&P 500 companies since the spring of 2020. If they’re right, it would also mark a third straight quarter where profits sank.

Such expectations are key for financial markets, because one of the biggest factors that sets a stock’s price is how much profit a company produces. Wall Street nevertheless has rallied hard this week and is on track for its seventh winning week in the last nine because of rising optimism for the other major lever that sets stock prices: how much investors are willing to pay for each $1 of corporate profits.

Two big reports showed that inflation continued to cool across the U.S. economy in June. That bolstered investors’ hopes that the Federal Reserve is close to feeling comfortable enough to halt its blistering campaign to raise interest rates.

The Fed has already hiked its federal funds rate up to a range of 5% to 5.25%. High rates undercut inflation by slowing the economy and putting downward pressure on prices for stocks and other kinds of investments.

The expectation is still for the Fed to raise rates one more time at its next meeting in two weeks. But the building bet is that will be the final hike of the cycle.

Treasury yields rose Friday, paring some of the sharp tumble from earlier in the week brought by traders paring bets for Fed rate hikes later this year.

The 10-year Treasury yield rose to 3.78% from 3.77% late Thursday. But it’s still well below the 3.98% it sat at on late Tuesday, before the inflation reports were released. The 10-year yield helps set rates for mortgages and other important loans.

The two-year Treasury yield more closely tracks expectations for Fed action, and it’s at 4.67%, down from 4.89% late Tuesday.

Hopes for an easier Fed have also helped stocks worldwide to strengthen this week, though markets abroad were mixed on Friday.


AP Business Writer Yuri Kageyama contributed.


Associated Press

Stock market today: Asian shares are mixed after Wall Street breaks losing streak

BANGKOK (AP) — Shares were mixed Tuesday in Asia after U.S. stocks closed broadly higher, as Big Tech stocks took back some of their recent sharp declines. U.S. futures edged lower and oil prices were little changed. Tokyo’s Nikkei 225 closed nearly unchanged, at 39,594.39. Chinese markets declined, with the Hang Seng in Hong Kong […]

17 hours ago

Associated Press

Hamas and Fatah sign declaration in Beijing on ending yearslong rift, Chinese state media says

BEIJING (AP) — Palestinian factions Hamas and Fatah signed a declaration in Beijing on ending yearslong rift, state media said Tuesday, without providing further details. The two rival Palestinian groups met with Chinese Foreign Minister Wang Yi, concluding talks that started Sunday.

18 hours ago

President Nicolas Maduro waves while riding in the back of a military vehicle during an Independenc...

Associated Press

Maduro seeks to shore up Venezuela military’s support ahead of vote threatening his hold on power

AGUA CALIENTE, Venezuela (AP) — At a crossroads not far from a gas station overgrown with weeds, young men and women in faded green fatigues stop vehicles returning from a rally for opponents of Venezuelan President Nicolás Maduro, ask passengers for their identifications, and inspect their cars, trucks and motorcycles. Such checkpoints have proliferated across […]

20 hours ago

A baby is carried by members of the Red Cross in the port of La Restinga at El Hierro in the Canary...

Associated Press

Thousands of migrant kids have reached the Canary Islands alone. Local officials want Spain’s help

BARCELONA, Spain (AP) — The children sometimes won’t stop crying. Health workers dealing with migrants arriving on Spain’s Canary Islands try to understand if the tears are from illness, injury or, as is often the case, from pure shock. One young Senegalese boy who disembarked recently kept fainting every few minutes, troubling doctors who couldn’t […]

20 hours ago

FILE - A horse belonging to Israeli settler Yinon Levi is seen at his farm in the West Bank outpost...

Associated Press

Israeli government quietly sends millions to unauthorized West Bank settler outposts

JERUSALEM (AP) — The Israeli government has budgeted millions of dollars to protect small, unauthorized Jewish farms in the Israeli-occupied West Bank, underwriting tiny outposts meant to grow into full-fledged settlements, according to an anti-settlement monitoring group. Documents uncovered by Peace Now illustrate how Israel’s pro-settler government has quietly poured money into the unauthorized outposts, […]

20 hours ago

Ukraine's President Volodymyr Zelenskyy leaves Downing Street after meeting with Britain's Prime Mi...

Associated Press

Biden’s withdrawal from the US presidential race spells new uncertainty for Ukraine

KYIV, Ukraine (AP) — U.S. President Joe Biden’s decision to end his campaign for reelection brings a new element of uncertainty for Ukraine, which is struggling to fend off Russian advances even as it worries about the future of American support. The prospect of victory for former President Donald Trump, the Republican contender, has long […]

1 day ago

Stock market today: Wall Street builds on its winning week following stronger profit reports