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Profit Reports Support Wall Street 10/13 09:42
Strong profit reports from Goldman Sachs, UnitedHealth Group and other big
U.S. companies are helping to shore up the stock market on Tuesday, even as
sharp drops for stocks in the computer chip industry circle the world and hit
Wall Street.
NEW YORK (AP) -- Strong profit reports from Goldman Sachs, UnitedHealth
Group and other big U.S. companies are helping to shore up the stock market on
Tuesday, even as sharp drops for stocks in the computer chip industry circle
the world and hit Wall Street.
The S&P 500 slipped 0.1% to pull a bit further from its all-time high set
last week, but the modest move masked big swings for stocks underneath the
surface. The Dow Jones Industrial Average was up 300 points, or 0.6% as of 9:35
a.m. Eastern time, while the Nasdaq composite was 0.4% lower.
Some of the sharpest action was among tech stocks, where drops for chip
companies dragged South Korea's Kospi index down 5.5%.
Worries have been high for a while about whether chip stock prices have shot
too high in the frenzy around artificial-intelligence technology, and concerns
rose further following reports that China's memory chipmaker CXMT is making
advances that could challenge industry heavyweights like Micron Technology of
Boise, Idaho and Samsung Electronics and SK Hynix of South Korea.
Micron fell 5.8% and was one of the heaviest weights on the S&P 500. Nvidia
slipped 1.3%, Advanced Micro Devices fell 3.3% and Broadcom slipped 1.3%
Elsewhere on Wall Street, stocks swung after the first wave of big U.S.
companies reported how much profit they made during the summer. Expectations
are high, and companies will need to deliver strong growth to justify the
record-breaking runs their stocks have made this year despite worries about
high inflation, discouraged customers and the war with Iran.
UnitedHealth Group climbed 2.6% after the healthcare company reported
stronger profit and revenue for the latest quarter than analysts expected. It
also raised its forecast for profit over the full year of 2026.
Goldman Sachs was another winner and added 1.4% after the bank delivered a
profit for July through September that blew past analysts' expectations. It
benefited from strong growth for its business that offers loans to clients for
trading stocks, even amid what CEO David Solomon called a "complicated
operating environment" created by lots of uncertainty.
On the losing end of Wall Street was Wells Fargo, which reported weaker
revenue for the latest quarter than analysts expected. Its stock fell 1.2%
after CEO Charlie Scharf said revenue sank from its venture capital investments.
But he also said that "our data shows that our consumer and business
customers are doing well" despite uncertainty about the economy and recent
surveys showing how discouraged Americans are about the economy.
At the country's biggest bank, JPMorgan Chase CEO Jamie Dimon also
highlighted "elevated asset prices" as one of the potential risks for the
economy, a potential nod to the criticism that prices for investments have run
too high. He also mentioned high inflation, rising interest rates and
"geopolitical conditions," among other challenges.
"These forces may be manageable, but we remain prepared for a wide range of
outcomes," he said.
JPMorgan Chase rose 1.2% after reporting a weaker profit for the latest
quarter than analysts expected but also giving a forecast for net interest
income in the current quarter that topped Wall Street's estimate.
In the bond market, Treasury yields eased after oil prices fell. The yield
on the 10-year Treasury slipped to 5.20% from 5.24% late Friday. Trading in the
U.S. bond market had been closed Monday for a holiday.
They benefited from a 1.3% drop for the price of a barrel of Brent crude oil
to $105.22.
In stock markets abroad, Japan's Nikkei 225 fell 1.8% on weakness for
several of its big tech stocks. Indexes were modestly higher elsewhere in Asia
and across Europe.
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