As inflation rises, Nasdaq rises on positive earnings signals

  • Netflix Profits on Customer Growth Forecast
  • Baker Hughes fell in a big quarterback loss
  • Tesla will report earnings after the market closes
  • The Dow was up 0.12%, the S&P 500 was up 0.39% and the Nasdaq was up 1.24%.

July 20 (Reuters) – The tech-heavy Nasdaq rose more than 1% on Wednesday as investors digested recent earnings as positive signals from the economy, despite concerns about inflation and a tighter central bank.

The S&P 500 rose 0.39%, while the Dow Jones Industrial Average fell 0.12%.

Netflix Inc (NFLX.O) Shares rose 6% after the company predicted a return to customer growth in the third quarter, while posting a better-than-expected 1 million drop in subscribers in the second quarter. read more

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Other high-growth stocks extended gains following the streaming service provider’s forecast. Shares of Apple Inc (AAPL.O)Amazon.com Inc (AMZN.O)Microsoft Corp (MSFT.O) and Meta Platforms Inc (META.O) Added between 1% and 3.6%.

S&P 500 technology sector index (.SPLRCT) Up 1.3%.

“Inflation is a very strong concept on investors’ minds…what we’re seeing today allows investors to hang on to some positive earnings announcements, which will bode well for the rest of Q3 and 2022,” said Greg Bassuk. CEO of AXS Investments in Port Chester, New York.

“Tesla, and Netflix, and some of these bellwether companies … investors are looking to send a message about the outlook for these companies in 2022.”

Electric vehicle maker Tesla Inc (TSLA.O) The market added 0.6% after its earnings report after the close.

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Analysts expect full-year S&P 500 profits to grow 5.9% this reporting season, down from an estimate of 6.8% at the start of the quarter, according to Refinitiv data.

Runaway inflation initially led markets to a full 100-basis-point hike in interest rates at the Fed’s upcoming meeting next week, until some policymakers signaled a 75-basis-point increase.

At 1:45 pm ET, the Dow Jones Industrial Average (.DJI) The S&P 500 fell 37.45 points, or 0.12%, to 31,789.6. (.SPX) The Nasdaq Composite rose 15.19 points, or 0.39%, to 3,951.88. (.IXIC) It added 145.44 points or 1.24% to 11,858.59.

Trading was volatile in thin volumes, along with the CBOE volatility index (.VIX) It last fell by 24.05 points to a one-month low.

“The low levels emphasize the market’s historical moves, and even if we wipe $10 or $15 trillion out of global equities this year, there’s still a lot of liquidity. So low levels of excess liquidity could emphasize more moves,” said John Lynch, chief investment officer at Comerica Wealth Management.

Health insurer Eleventh Health Inc. was the biggest S&P percentage loser, falling 9% as the company’s medical costs did not fall in line with rival UnitedHealth Group Inc.

Baker Hughes Co fell 7.8% after the oilfield services provider reported a big second-quarter loss while its adjusted profit also missed estimates. read more

Advancing issues outnumber declining issues on the NYSE by a 1.55-to-1 ratio; On the Nasdaq, a 2.09-to-1 ratio favored advancers.

The S&P 500 posted a new 52-week high and 29 new low; The Nasdaq Composite posted 24 new highs and 24 new lows.

Reporting by Echo Wang in New York and Shreyashi Sanyal in Bangalore; Additional reporting by Anirudha Ghosh in Bangalore; Editing by Sriraj Kalluvila, Shaunak Dasgupta and Lisa Schumacher

Our Standards: Thomson Reuters Trust Principles.

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