S&P 500 Edges Higher to Record

The Dow Jones Industrial Average ticked down 6.26 points, or 0.02%, to 35603.08. Shares of International Business Machines, a Dow component, fell $13.57, or 9.6%, to $128.33. The company reported weaker revenue than analysts had expected in the latest quarter.

“The craziest thing about what I see going on in markets is just an absolute tug of war between growth and value investments,” said Jeff Powell, managing partner and chief investment officer at Polaris Wealth Advisory Group. “I’ve not seen a market like this in a really long time.”

Stocks have risen in recent days, after solid earnings helped quell concerns that sent markets lower at the start of fall. Among those worries: a slowdown in China’s economy, supply-chain blockages that have hampered sectors such as manufacturing, and inflation pressures.

Data showed jobless claims fell to a new pandemic low last week, a sign layoffs remain rare. Filings for initial unemployment benefits fell to 290,000 from 296,000 the week before, the Labor Department said. Meanwhile, existing-home sales rebounded in September, rising 7% from the prior month.

The shared-office company WeWork started trading publicly Thursday, two years after its planned initial public offering imploded. The company went public through a combination with BowX Acquisition Corp., a special-purpose acquisition company. Shares rose $1.40, or 13%, to $11.78.

Third-quarter earnings are being closely watched by investors. They could provide a clearer picture of the pandemic recovery than the previous couple of quarters did.

“Coming out of the depressed period of Covid and turning everything back on you had this amazing year-over-year comparison that was really easy to accomplish,” said Kevin Philip, managing director at Bel Air Investment Advisors. “Now the question for a lot of people is “What’s next?’…Will the earnings after this big jump sustain themselves?”

Earnings reports will offer clues about consumer spending habits. “I would not bet against the American consumer,” Mr. Philip said. “It’s been a terrible bet.”

AT&T shares fell $0.15, or 0.6%, to $25.76 after the company said it expected full-year earnings to reach the high end of its target. Blackstone shares gained $3.83, or 3%, to $132.52 on net income that almost doubled in the third quarter.

Of the 80 companies on the S&P 500 to have reported through Wednesday, 81% had topped analysts’ earnings forecasts, according to FactSet, better than the roughly 75% that did so each quarter in 2019.

“We’ve gone through a period of hesitation that’s brought a bit of volatility but I think stocks will keep trending higher,” said Paul Jackson, head of asset allocation research at Invesco. He expects households to keep spending savings accumulated during the pandemic. 

HP raised its dividend and outlook for the 2022 fiscal year, and shares jumped $1.98, or 6.9%, to $30.57. Tesla added $28.20, or 3.3%, to $894 after the auto maker said late Wednesday it had notched a third-straight record quarterly profit. 

Overseas markets were broadly lower. Shares of China Evergrande Group slumped 13% in Hong Kong after the embattled developer canceled plans to sell a majority stake in its property-management unit, a setback in attempts to ease its continuing cash crisis.

Hong Kong’s Hang Seng Index fell 0.5%, Japan’s Nikkei 225 lost 1.9% and China’s Shanghai Composite Index ticked up 0.2%.

The pan-continental Stoxx Europe 600 fell 0.1%, weighed down by stocks in the basic-resources, auto and industrial sectors. Miners Anglo American and BHP Group were both down, and copper prices pulled back from recent highs.

In the bond market, the yield on benchmark 10-year Treasury note edged up to 1.674%. Bond yields and prices move in opposite directions.

Brent crude, the international oil benchmark, lost $1.21 per barrel, or 1.4%, to $84.61. It was still the fourth highest settle value of this year.

The Turkish lira fell. Turkey’s central bank lowered its key interest rate to 16% from 18%, a larger cut than investors expected.

Write to Joe Wallace at [email protected] and Hardika Singh at [email protected]