Benchmarks continued to move upward as investors remained
optimistic that lawmakers are closer to sealing a deal which will
end the partial government shutdown and increase the nation's
debt limit. The Dow and the S&P 500 finished in the green for
the fourth consecutive day. Congress must increase the county's
borrowing limit before October 17 in order to avoid possible
default on its debt. The health care sector was the biggest
gainer among the S&P 500 industry groups. The utilities
sector was the only loser.
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Ahead of Wall Street
The Dow Jones Industrial Average (DJI) gained 0.4% to close the
day at 15,301.26. The S&P 500 rose 0.4% to finish yesterday's
trading session at 1,710.14. The tech-laden Nasdaq Composite
Index climbed 0.6% to end at 3,815.27. The fear-gauge CBOE
Volatility Index (VIX) climbed 2.2% to settle at 16.07.
Consolidated volumes on the New York Stock Exchange, American
Stock Exchange and Nasdaq were roughly 4.77 billion shares,
considerably lower than 2013's average of 6.0 billion shares.
Advancing stocks outnumbered the decliners. For 56% shares that
advanced, 40% declined.
Stocks began yesterday's trading session lower after weekend
negotiations between Democrats and Republicans failed to seal a
deal. But indices erased their initial losses soon after Senate
leaders said they were heading in the right direction towards
reaching an agreement. On Monday, Senate Majority Leader Harry
Reid and Senate Republican Leader Mitch McConnell met for half an
hour. After the meeting Reid said: "We're working on everything."
He was "very optimistic" that Congress will seal a deal.
President Barack Obama said: "My hope is that a spirit of
cooperation will move us forward in the next few hours."
According to a statement from the White House, a meeting between
President Barack Obama and Congressional leaders which was
originally scheduled yesterday at 3pm ET was postponed. The
meeting was postponed to give lawmakers "time to continue making
progress" to find a solution to the
The third quarter earnings season gets into high gear this week,
with more than 160 companies reporting their quarterly results,
including 70 companies from S&P 500. Major companies like
Citigroup Inc (NYSE:
), The Coca-Cola Company (NYSE:
), Goldman Sachs Group Inc (NYSE:
), International Business Machines Corp. (NYSE:
), Bank of America Corp (NYSE:
) and General Electric Company (NYSE:
) are scheduled to report their quarterly results this week.
According to Thomson Reuters data, earnings of the S&P 500
companies are expected to grow by 4.2% this quarter. This is
sharply below their earlier forecast of 8.5%.
On the international front, China's annual consumer inflation
touched a seven-month high in September. According to the
China's National Bureau of Statistics, annual consumer inflation
climbed to 3.1% from 2.6%. This was higher than the market
forecast of 2.9%. On the other hand, China's exports
declined unexpectedly by 0.3% in September.
The healthcare sector was the biggest gainer among the S&P
500 industry groups and the Health Care SPDR (XLV) gained 0.7%.
Stocks such as Johnson & Johnson (NYSE:
), GlaxoSmithKline plc (ADR) (NYSE:
), Gilead Sciences, Inc. (NASDAQ:
), Eli Lilly & Co. (NYSE:
) and Pfizer Inc. (NYSE:
) increased 0.4%, 1.1%, 1.9%, 0.3% and 2.2%, respectively.
Utilities sector was the only loser among the S&P 500
industry groups and the Utilities SPDR (XLU) lost 0.5%. Stocks
such as Public Service Enterprise Group Inc. (NYSE:
), Exelon Corporation (NYSE:
), PG&E Corporation (NYSE:
), Consolidated Edison, Inc. (NYSE:
) and Edison International (NYSE:
) slipped 0.5%, 1.1%, 0.9%, 0.5% and 0.5%, respectively.