Wall Street edges higher on Tesla boost ahead of big tech earnings

A trader takes a break outside the New York Stock Exchange in New York
A trader takes a break outside the New York Stock Exchange amid the coronavirus disease (COVID-19) pandemic in the Manhattan borough of New York City, New York, U.S., April 16, 2021.
REUTERS/Carlo Allegri

Wall Street’s main indexes rose on Monday as Tesla shares gained ahead of the electric-car maker’s earnings report, which would kick off this week’s results from heavyweight technology companies.

Tesla Inc rose 1.1% as analysts expect the company to report a rise in first-quarter revenue when it reports after markets close following record deliveries during the period.

About 40% of the S&P 500’s market cap report from Tuesday through Thursday, including tech and related heavyweights Microsoft Corp, Google parent Alphabet Inc, Apple Inc and Facebook Inc. Shares of the companies were mixed in early trading.

“The market is in a holding pattern waiting for big-tech earnings. We could see a bifurcated result in tech earnings with ad providers like Facebook and Google doing very well, while Apple coming up against very tough comparison year-on-year,” said Thomas Hayes, chairman at Great Hill Capital LLC, New York.

Seven of the 11 major S&P 500 sectors were trading higher, with financials gaining the most, while defensive utilities and consumer staples led declines.

Of the 123 companies in the S&P 500 that have reported so far, 85.4% have topped analysts’ earnings estimates, with Refinitiv IBES data now predicting a 33.9% jump in profit growth.

Investors are also looking forward to the two-day Federal Reserve meeting beginning on Tuesday and the first-quarter gross domestic product numbers later this week to gauge the pace of the economic recovery.

At 9:58 a.m. ET, the Dow Jones Industrial Average was up 62.54 points, or 0.18%, at 34,106.03, the S&P 500 was up 7.64 points, or 0.18%, at 4,187.81 and the Nasdaq Composite was up 24.49 points, or 0.17%, at 14,041.30.

Market participants are also watching out for any fresh developments on Biden’s tax plan after reports last week said he would seek to nearly double the capital gains tax to 39.6% for wealthy individuals.

Meanwhile, analysts at Goldman Sachs, Morgan Stanley, Deutsche Bank have warned of some turbulence ahead, after a rally that has taken the S&P 500 and Dow to fresh records this year.

Cryptocurrency and blockchain-related firms like Riot Blockchain and Marathon Patent Group rose in early trading as Bitcoin looked set to snap five straight days of losses.

Advancing issues outnumbered decliners by a 2.22-to-1 ratio on the NYSE and by a 2.09-to-1 ratio on the Nasdaq.

The S&P index recorded 88 new 52-week highs and no new low, while the Nasdaq recorded 94 new highs and seven new lows.