Wall St scales record peaks on earnings cheer; Fed meeting in focus

Wall St scales record peaks on earnings cheer; Fed meeting in focus
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NEW YORK/BENGALURU (Nov 2): Wall Street's main indexes climbed to record highs on Tuesday, getting a boost from a string of encouraging earnings reports, while investors anticipated the Federal Reserve's next meeting where policymakers are expected to announce the withdrawal of pandemic-era stimulus.

Shares of Under Armour Inc jumped 15.5%, after the athletic apparel maker raised its annual revenue and profit forecasts.

Arista Networks surged 19.9% to scale a new peak as brokerages raised their price targets on the cloud infrastructure supplier's stock, following strong third-quarter results.

Simon Property Group added 5% after the mall operator raised its 2021 forecast for profit and quarterly dividend.

Economy-sensitive Dow Jones Transports index soared 5.5% to hit an all-time high, lifted by an 88.6% surge in shares of car-rental firm Avis Budget.

Seven of the 11 major S&P sectors advanced, with technology rising the most.

Mega-cap technology names Apple Inc, Microsoft Corp and Google-owner Alphabet Inc rose to help offset declines of 3.2% in shares of Tesla Inc.

Tesla's top boss Elon Musk said the electric car maker had not signed a contract with Hertz.

"The interest remains high for most of the FAANG stocks and really technology as a whole and investors are more interested in holding these names than selling them for gains," said Rick Meckler, partner at Cherry Lane Investments in New Jersey.

Spotlight is now on the Fed's policy meeting starting Tuesday, with the US central bank expected to approve plans to start tapering its monthly bond purchases, while focus will also be on commentary about interest rates and how sustained the recent surge in inflation is.

"Today the economy is in a much better footing and with inflation at current levels we don't need such amount of accommodative policies and a taper in turn will send a signal to the market that the economy is better off," said Michael Sheldon, chief investment officer at RDM Financial Group at Hightower in Westport, Connecticut.

"The risk for the market, however, will arise next year and if inflation remains higher for a longer duration, it will lead the Fed to be more aggressive or step up the timetable for rate increases that could lead to some instability in markets."

An unprecedented amount of monetary and policy stimulus has helped Wall Street bounce back strongly from a pandemic-driven recession last year. Coupled with that, a largely upbeat third-quarter reporting season has also helped drive US stocks to record highs this week.

At 12:00 p.m. ET, the Dow Jones Industrial Average was up 95.92 points or 0.27% at 36,009.76, the S&P 500 was up 13.38 points or 0.29% at 4,627.05, and the Nasdaq Composite was up 26.37 points or 0.17% at 15,622.28.

Pfizer Inc gained 4.5%, after the drugmaker raised its full-year sales forecast for the company's Covid-19 vaccine to US$36 billion.

Declining issues outnumbered advancers for a 1.41-to-1 ratio on the NYSE and for a 1.44-to-1 ratio on the Nasdaq.

The S&P index recorded 50 new 52-week highs and four new lows, while the Nasdaq recorded 148 new highs and 28 new lows.