By Damian J. Troise and Alex Veiga
Technology and health care companies led a broad rally on Wall Street Tuesday that helped stocks overcome a wobbly start and recoup their losses from a day earlier.
The S&P 500 rose 0.8% after having been down 0.3% in the early going. The gain inched the benchmark index to an all-time high, eclipsing the record it set early last week.
Banks, industrial companies and energy stocks also helped push the S&P 500 higher. Communications companies were the only laggard. Treasury yields were mixed.
Investors weighed another large swath of company earnings reports Tuesday, including quarterly snapshots from Ralph Lauren and Clorox. While earnings have been strong, Wall Street remains cautious over COVID-19 and its potential impact on a still recovering economy amid the spread of the highly contagious delta variant.
This mutant version of COVID-19 is still reason for caution, but it likely won’t have a significant impact on the economy’s reopening and recovery because hospitalizations are relatively tame and fatalities are very low in comparison to infections, said Jason Pride, chief investment officer of private wealth at Glenmede.
“We may still deal with the lingering residual effects of the pandemic,” Pride said. “You’ve probably got a period of time where the economy has to restitch itself back together.”
The S&P 500 rose 35.99 points to 4,423.15. The Dow Jones Industrial Average gained 278.24 points, or 0.8%, to 35,116.40. and the Nasdaq composite index picked up 80.23 points, or 0.6%, to 14,761.29.
Smaller company stocks also notched gains. The Russell 2000 index rose 8.09 points, or 0.4%, to 2,223.58.
Investors are in the midst of earnings season, with more than 100 companies in the S&P 500 index reporting their results this week. So far earnings have been strong, with roughly nine out of every 10 companies beating analysts' expectations.
Clorox slumped 9.5%, the stock's biggest single-day drop since 2000, after reporting results that fell short of forecast and releasing a disappointing outlook.
Solid financial results helped lift several other companies. Ralph Lauren climbed 6.1% after handily beating analysts’ fiscal first-quarter profit forecasts as sales rebounded. Columbia Sportswear rose 0.6% after reporting a surprise second-quarter profit.
Activision Blizzard fell 3.5% after the head of Blizzard Entertainment said he would resign, effective immediately. Blizzard, maker of popular video games such as “Overwatch” and “World of Warcraft,” has been accused in a lawsuit of having a toxic work environment which has caused walkouts by employees.
Online broker Robinhood jumped 24.2% and topped its IPO price for the first time since its stock began trading last Thursday.
Bond yields were relatively stable. The yield on 10-year Treasury inched up to 1.18% from 1.17% from the day before. Less than a month ago, the 10-year note was trading around a yield of 1.35%.
Investors will be watching closely when the Labor Department releases its July jobs report Friday. Economists surveyed by FactSet forecast that the employers created 837,500 jobs last month and the unemployment rate fell to 5.7%.
Updated on August 3, 2021, at 5:14 p.m. ET.
