Stocks climbed on Tuesday, rebounding from a losing week, as investors digested results from the new earnings season as well as signals for another big stimulus and faster pace of vaccine distribution ahead.
The Dow Jones Industrials got their groove back in time to gain 116.26 points to 30,930.52.
The S&P 500 strengthened 30.66 points to 3,798.91, led by energy and communication services sectors
The NASDAQ popped 198.68 points, or 1.5%, to 13,197.18.
Some of the major technology stocks rebounded sharply from last week’s losses. Facebook charged ahead 3.9%, and Alphabet climbed 3.3%, while Microsoft rose 1.8%. Apple and Amazon also advanced.
Shares of Goldman Sachs erased earlier gains and fell 2.3% as traders took profits after the bank topped expectations for fourth-quarter profit and revenue. The blowout results came on the back of strong performance from its equities traders and investment bankers.
Bank of America dipped 0.7% after the bank posted quarterly revenue that missed expectations. Profit came in slightly above estimates, however.
The first week of earnings season saw a historically high proportion of beats with 88% of the S&P 500 companies that reported exceeding EPS estimates, according to Bank of America data.
While the earnings cycle started out strong, many on Wall Street believe fourth-quarter earnings have been priced in and the market is focused on the 2021 outlook and the ultimate size of fiscal stimulus that would translate into profit growth.
Janet Yellen, President-elect Joe Biden’s designated nominee for Treasury Secretary and a former chair of the Federal Reserve, will appear before the Senate Finance Committee on Tuesday. Yellen’s prepared remarks call for the federal government to enact a large stimulus to help the economy.
The U.S. stock market was closed on Monday in honour of Martin Luther King Jr. Day.
Prices for the 10-Year Treasury gained ground, dropping yields to 1.09% from the morning’s 1.11%. Treasury prices and yields move in opposite directions.
Oil prices gained 63 cents to $52.99 U.S. a barrel.
Gold prices gained $9.10 to $1,839,00 U.S. an ounce.