U.S. stocks marched broadly higher in afternoon trading Tuesday on Wall Street as several major companies reported solid second quarter earnings.
The steady gains built on Monday’s upward momentum and moved stocks closer to record highs reached just over a week ago. Stocks have been volatile in July, gaining ground through the first half of the month, then sliding.
Corporate earnings are now in full swing after last week’s relatively light load of mixed results. Nearly 150 companies in the S&P 500 will report their financial results through Friday. Analysts are expecting this round of earnings to be weak.
Banks continued leading the market higher. JPMorgan Chase, Bank of America and several others gained ground as bond yields rose. Higher bond yields allow banks to charge more interest on loans.
Coca-Cola soared after beating Wall Street’s second quarter profit forecasts. The surprisingly good results helped lift other consumer product makers. Kraft Heinz rose 2.1% and Kellogg rose 2.9%
Stanley Black & Decker surged after it reported second quarter profit well above analysts’ forecasts. The tool maker made one of the biggest gains in the industrial sector. General Electric rose 4.3% and 3M rose 1.6%.
Biogen rose 4.2% and Quest gained 5% on solid earnings results and helped push the broader health care sector higher.
Utilities lagged the market as investors moved away from defensive holdings and took on more risk.
Visa, Texas Instruments and Chipotle are among the largest companies that will report earnings after the close of regular trading Tuesday. The steady flow of corporate results continues Wednesday with companies including AT&T, Caterpillar and Facebook.
KEEPING SCORE: The S&P 500 index rose 0.6% as of 2:15 p.m. Eastern time. The Dow Jones Industrial Average rose 154 points, or 0.6%, to 27,326. The Nasdaq composite rose 0.4%.
ANALYST’S TAKE: Corporate earnings remain the key focus for investors. Overall, companies are on track for a retreat in profit that would mark the second consecutive earnings slowdown.
“Interestingly, the market seems like it almost doesn’t care,” said Jason Pride, chief investment officer of private wealth at Glenmede Trust Co. The earnings downturn has been modest so far and is being tempered by a still expanding economy and a Federal Reserve that has said it is willing to support growth.
OVERSEAS: European stocks moved broadly higher, though London’s FTSE 100 was relatively flat after Boris Johnson was named as the new prime minister, a move that could increase the risks of a disorderly Brexit. Germany’s DAX soared 1.8% and France’s CAC 40 rose 1.2%.
STOCK POP: Coca-Cola rose 5.6% after the beverage company raised its revenue forecast for the year following a solid second quarter. The company reported 3% growth in sales of its namesake soft drinks and it has been expanding into energy drinks and coffee.
HOUSING HIT: Homebuilders fell broadly after the National Association of Realtors reported a 1.7% drop in June home sales. Rising prices and a scarce supply of homes have been making it more difficult for first-time homebuyers.
D.R. Horton fell 2.3% and PulteGroup shed 7.4%.
WELL PLAYED: Hasbro rose 8.8% after blowing away Wall Street’s second quarter profit forecasts. The toy maker reported growth for many of its classic games and toys, including the board game Monopoly and Play-Doh. It also reported growth for its digital game “Magic: The Gathering” and got some help from its partnership with Marvel on Avengers and Spiderman action figures.
QUALITY TOOLS: Stanley Black & Decker rose 5.9% after the tool maker beat Wall Street’s profit forecasts for the second quarter. The company reported increases in sales volumes and prices for its tools and storage products.
OIL: Oil prices edged higher. Benchmark U.S. crude rose 0.8%. Brent crude oil, the international standard, rose 0.7%. Energy prices have been volatile over the last few weeks as tensions between the U.S. and Iran intensify.