S&P 500 and Nasdaq Extend Rally to Sixth Week, Netflix Pops 10%

Barry Adams
18 Oct, 2024
New York City

Stock market indexes extended gains for the sixth week in a row amid positive earnings and a stable macroeconomic backdrop. 

The S&P 500 index increased 0.2% and the Nasdaq Composite advanced 0.6%, and they are likely to close higher by more than 0.5% for the week. 

Market sentiment was positive after investors reviewed the latest earnings from American Express, Procter & Gamble, and Travelers. 

CVS Healthcare plunged more than 10% after the company announced a change in leadership and reported weaker-than-expected third quarter preliminary earnings per share. 

On the economic front, housing starts decreased 0.5% from the previous month in September to 1.354 million, and building permits fell 2.9% to 1.428 million, according to the U.S. Census Bureau and the U.S. Department of Housing and Urban Development. 

Housing completions declined 5.7% from the revised estimate in August to an annual rate of 1.68 million. 

In the overseas market, China reported a raft of economic data confirming slowdown and persistent weakness in the housing market. 

GDP in the third quarter expanded at an annual pace of 4.6%, slower than the 4.7% rate in the second quarter, and new home prices plunged 6.1% across 70 mainland cities in September. 

 

U.S. Indexes and Treasury Yields

The S&P 500 index increased 0.2% to 5,853.0, the Nasdaq Composite rose 0.6% to 18,490.27, and the Russell 2000 index advanced 0.1% to 2,284.36. 

The yield on 2-year Treasury notes edged lower to 3.96%, 10-year Treasury notes inched up to 4.08%, and 30-year Treasury bonds inched higher to 4.39%.

WTI crude oil decreased $0.32 to $70.35 a barrel, and natural gas prices edged up 1 cent to $2.34 a thermal unit.

Gold rose by $17.11 to $2,711.20 an ounce, and silver increased by $0.46 to $32.24.

The dollar index, which weighs the US currency against a basket of foreign currencies, edged higher to 103.53.

 

U.S. Stock Movers

Procter & Gamble declined 1.8% to $168.53 after the consumer products company reported quarterly results. 

Revenue in the fiscal first quarter ending in September declined 1% to $21.7 billion from $21.9 billion, net income decreased 12% to $3.9 billion from $4.5 billion, and diluted earnings per share dropped 12% to $1.81 from $1.61 from $1.83 a year ago. 

The company reiterated its full-year revenue growth to range between 2% and 4% and diluted earnings per share to increase between 10% and 12% from $6.02 in 2024, or between $6.91 and $7.05. 

Netflix increased 10.2% to $759.70 after the streaming services provider reported better-than-expected quarterly results. 

Revenue in the third quarter increased 15% to $9.8 billion from $8.5 billion, net income rose 26% to $2.3 billion from $1.7 billion, and diluted earnings per share advanced 45% to $5.40 from $3.73 a year ago. 

Global streaming paid net members increased 14.4% to 282.7 million, and the company added 5.07 million new net paid members. 

CVS Healthcare declined 7.5% to $58.90 after the drugstore chain announced preliminary third quarter earnings and replaced its chief executive. 

The company estimated diluted earnings per share to range between 3 cents and 8 cents and adjusted earnings per share between $1.05 and $1.10. 

The company appointed longtime executive David Joyner as the new chief executive and president, replacing Karen Lynch effective October 17. 

The drug retailer said it plans to take a restructuring charge of $1.2 billion in the third quarter, related to incremental store closure costs and previously disclosed cost reduction actions.