Nasdaq has risen after Reuters’ powerful Microsoft forecast

Reuters. File photo: Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, October 18, 2021. REUTERS / Brendan McDermid

Devik Jain and Shashank Nair

(Reuters) – A strong forecast from Microsoft backed optimism about a third-quarter earnings season after leading Nasdaq gains on Wall Street indices on Wednesday, as falling oil prices hit shares of energy firms.

Seven of the 11 major S&P 500 sectoral indexes struggled for direction in the first hour of trading, with declines.

Microsoft Corporation (NASDAQ πŸ™‚ The calendar jumped 3.6% after predicting a strong end to the year, thanks to its growing cloud business. Google-owned Alphabet (NASDAQ πŸ™‚ Inc. gained 3.3% after reporting a record quarterly profit growth in ad sales.

Their shares, combined with other mega-cap growth names (NASDAQ :), and Tesla (NASDAQ πŸ™‚ Inc., gave the Nasdaq index the biggest boost.

Dennis Dick, a trader at Bright Trading LLC, said, “Today feels like the calm before the storm that should be tomorrow and everyone wants to know how supply-chain problems will work.”

Concerns over rising prices, potentially high corporate taxes and the Federal Reserve’s tapping plans hit markets last month, but bullish earnings reports strengthened sentiment in October, helping the S&P 500 and the Dow reach all-time highs this week.

As of Tuesday, the S&P 500 company’s third-quarter profit is expected to grow 35.6% year-over-year. Of the 144 companies that reported earnings, 81.9% reported above analysts ’expectations, according to reflective IBES data.

Strength and materials led the S&P 500 sectoral fall, tracking commodity prices. [O/R][MET/L]

Major lenders such as Bank of America Corporation (NYSE πŸ™‚ and JPMorgan (NYSE πŸ™‚ have slipped into a flat U.S. yield curve. [US/]

At 10:25 am ET, the Dow Jones Industrial Average was up 33.66 points, or 0.09%, at 35,723.22, the S&P 500 was up 1.19 points, or 0.03%, at 4,575.98, and 9%, or 9%, 395 points. At 15,295.70.

Shares of McDonald’s Corporation (NYSE πŸ™‚ rose 1.9% while the fast-food company reported quarterly sales in the same store, while Coca-Cola (NYSE πŸ™‚ Co added 2.1% after the beverage maker raised its full-year profit forecast.

Visa Inc. (NYSE πŸ™‚ fell 4.4% because its ‘conservative’ 2022 forecast is better cloudy than expected earnings in the fourth quarter.

Top Senate Democrat Ron Wyden has proposed a so-called billionaire tax that would require U.S. billionaires to pay taxes on unrealistic profits from their assets.

“Taxing unrealistic profits is a scary thing. We have a government that is not afraid to pay taxes and it effectively affects investor attitudes,” Dick said.

Texas Instruments (NASDAQ πŸ™‚ Inc. fell 6.0% while it forecast quarterly earnings as the chipmaker struggles with supply chain constraints in the semiconductor industry.

Robinhood Markets Inc (NASDAQ πŸ™‚ fell 9.7% after retail brokers lost third-quarter revenue as trading levels for cryptocurrencies, including Dodgecoin, declined.

Reducing the number of advances for the 1.52-to-1 ratio on the NYSE and the 1.72-to-1 ratio on the Nasdaq has overcome the problems.

The S&P index recorded 24 new 52-week highs and two new lows, while the Nasdaq recorded 42 new highs and 59 new lows.

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