Market Close: Stocks Climb as Solid Earnings Reports Roll In

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Dow Jones Industrial Average Closes In On 17,000 As 3rd Quarter Begins
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NEW YORK -- Solid earnings for a range of big companies helped nudge the stock market higher on Tuesday.

The restaurant chain Chipotle Mexican Grill (CMG) and the cable giant Comcast (CMCSK) surged after reporting better results than Wall Street expected.

"The news today is pretty good," said JJ Kinahan, chief strategist at TD Ameritrade. Kinahan pointed to a report out Tuesday that showed little sign of inflation and an overall stronger outlook for earnings. During conference calls to discuss quarterly results, more CEOs are taking an optimistic tone, he said, instead of warning about possible dangers.

"In the past, they all spent their time tempering expectations," Kinahan said. "This earnings season we're not seeing that at all. I think people are taking comfort in it."

The Standard & Poor's 500 index (^GPSC) added 9.90 points, or 0.5 percent, to 1,983.53. The Dow Jones industrial average (^DJI) rose 61.81 points, or 0.4 percent, to 17,113.54. The Nasdaq composite (^IXIC) advanced 31.31 points, or 0.7 percent, to 4,456.02.

Chipotle surged $69.84, or 12 percent, to $659.77, the biggest gain in the S&P 500 index. The burrito chain reported that stronger sales drove its quarterly profit up 26 percent. The restaurant chain's results beat analysts' expectations, even as it raised prices on a range of menu items.

Comcast, the country's largest cable company, reported quarterly profits that topped Wall Street's targets as more people signed up for Internet service. Comcast gained 81 cents, or 1.5 percent, to $54.63.

Wall Street is in the middle of corporate earnings season, when companies release their quarterly results. Investors pore over those reports to gauge the financial health of Corporate America, and in turn, the U.S. economy. Roughly 150 companies in the S&P 500 will report their results this week, including AT&T (T) and Boeing (BA) on Wednesday. Visa (V) and Amazon (AMZN) will report on Thursday.

Not all the results released Tuesday were positive. Weak sales of Diet Coke and fruit juice weighed down Coca-Cola's (KO) second-quarter results, leading the company to post weaker revenue than Wall Street expected. Overall profit fell slightly. Coca-Cola's stock sank $1.21, or 3 percent, to $41.19.

Even though companies continue to post higher profits, the market still looks expensive compared to its historical average. The S&P 500 currently trades for 17.4 times earnings over the previous 12 months. The long-run average is closer to 15.

"In the short term, I expect the market to continue higher," said Brad McMillan, the chief investment officer at Commonwealth Financial. "But I am concerned about the market's valuation."

On the economic front, investors got another tame report on inflation. U.S. consumer prices inched up 0.3 percent in June, with most of the increase coming from higher gasoline prices, according to the Labor Department. Core prices, which exclude the volatile food and energy sectors, were up just 0.1 percent. Over the past year, core prices are up 1.9 percent, close to the Federal Reserve's target rate for inflation.

U.S. government bond prices rose, pushing the yield on the 10-year Treasury note down to 2.46 percent. Benchmark U.S. crude oil fell 17 cents to $104.42 a barrel.

In other company news:

Herbalife (HLF) jumped $13.75, or 26 percent, to $67.77. Activist investor Bill Ackman, who has a $1 billion bet against the company, lobbed his latest attack against the nutritional supplement and weight-loss company, but investors appeared to dismiss it.

What to Watch Wednesday:
  • The Mortgage Bankers Association reports weekly mortgage applications at 7 a.m. Eastern time.
These major companies are scheduled to release quarterly financial statements:
  • AT&T (T)
  • ABB (ABB)
  • Biogen Idec (BIIB)
  • Boeing (BA)
  • Cheesecake Factory (CAKE)
  • CoreLogic (CLGX)
  • Delta Air Lines (DAL)
  • Dow Chemical (DOW)
  • E-Trade Financial (ETFC)
  • EMC (EMC)
  • Equifax (EFX)
  • Facebook (FB)
  • General Dynamics (GD)
  • Gilead Sciences (GILD)
  • GlaxoSmithKline (GSK)
  • Hanesbrands (HBI)
  • Morningstar (MORN)
  • Norfolk Southern (NSC)
  • Northrop Grumman (NOC)
  • Owens Corning (OC)
  • PepsiCo (PEP)
  • Qualcomm (QCOM)
  • Simon Property Group (SPG)
  • TripAdvisor (TRIP)
  • Tupperware Brands (TUP)
  • W.R. Grace (GRA)
  • Whirlpool (WHR)

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21 Comments

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chitt9111

ovomit must be removed from our white house in handcuffs in 2014 n deported , along with his illegal immigrants he let 'BREAK' into America n his record unemployment n his record foreclosures for the last 5 plus years now, so fly your american flag upside down for the death of America until. !!!!!

July 22 2014 at 9:11 PM Report abuse -3 rate up rate down Reply
1 reply to chitt9111's comment
clark8642

You don't even bother to change your repetitious post to try to make it a little less foolish. With all your practice you can do better. Good luck.

July 23 2014 at 4:29 AM Report abuse rate up rate down Reply
Iselin007

Interesting ( Owens Corning) wasn't that the corporation whose Visa worker designed the bomb that blew up the basement of the WTC in 1993. Two of the designer's buddies were living in apartments above each other in Avenel Woodbridge NJ. The Avenel associates had visas that allowed them to purchase fertilizer with high percentages of chemicals not found in the store.

So rate might post negative sh...head that was a fact.

July 22 2014 at 8:43 PM Report abuse -3 rate up rate down Reply
weilunion

anyone who does not know the stock market is fixied is delusional. Ever been to Vegas? The House always wins and the suckers always lose

July 22 2014 at 8:30 PM Report abuse +2 rate up rate down Reply
2 replies to weilunion's comment
Iselin007

Anyone that learns how to beat the house gets tossed out. I knew a guy that quit his job because he was making 6 times his paycheck every week beating the house.

July 22 2014 at 8:53 PM Report abuse -1 rate up rate down Reply
merstockgto

And you are the sucker that is losing by not investing. Have invested since 1980 and I can tell you that you are FULL of it.

July 22 2014 at 10:41 PM Report abuse rate up rate down Reply
Leroy Gd

SOLID EARNINGS? Maybe the numb nut brain dead lefty liberals are stupid enough to believe that but normal people know that is a lie.

July 22 2014 at 7:50 PM Report abuse -4 rate up rate down Reply
2 replies to Leroy Gd's comment
Iselin007

The earnings are whatever they say they are and they'll say that to the next big bubble when their surrounded by thousands of others to take the focus off them.

July 22 2014 at 8:19 PM Report abuse rate up rate down Reply
weilunion

What is a liberal? no, the right wing and the corporate demos believe it and push it. The stock amrket is fixed

July 22 2014 at 8:31 PM Report abuse -1 rate up rate down Reply
Iselin007

One of the companies in these earnings reports has a secret. The company had their employees at one time relenquesh their permanent employee status then sign back on as private contractors. No that wasn't the secret.

July 22 2014 at 6:36 PM Report abuse -3 rate up rate down Reply
Iselin007

New Jersey has one of the highest concentrations of the visa workers outside of Silicon Valley. The earnings report by Microsoft was an important one considering they have staff in New Jersey. See a corelation yet?

July 22 2014 at 6:22 PM Report abuse -3 rate up rate down Reply
2 replies to Iselin007's comment
weilunion

http://www.dailycensored.com/microsoft-to-lay-off-workers-and-offer-exciting-relocation-plan/

July 22 2014 at 8:32 PM Report abuse -1 rate up rate down Reply
1 reply to weilunion's comment
Iselin007

I read some of the stories in the site. Hope they are taking the visa workers with them!

July 22 2014 at 9:20 PM Report abuse -1 rate up rate down
chitt9111

every single illegal immigrant that ovomit let "BREAK" into america "must" be deported first n then SHUT N SEAL THE BORDERS". !!!!!

July 22 2014 at 9:13 PM Report abuse -1 rate up rate down Reply
Frank

Too bad most companies don't share the success with the workers...you know..the people who helped them achieve those numbers. Let's start with a living wage...and maybe some benefits. Enough of the low wage/temp/no benefit positions.

July 22 2014 at 6:10 PM Report abuse +4 rate up rate down Reply
2 replies to Frank's comment
Iselin007

I agree with your statement however the jerk that rated my post should be among the first fired.

July 22 2014 at 6:26 PM Report abuse -3 rate up rate down Reply
SPQR

They do share some...99% for them and 1 % for the workers. Where I worked they took away our 1 free hotdog in the summer. They said it was just too expensive !

July 22 2014 at 7:01 PM Report abuse +5 rate up rate down Reply
1 reply to SPQR's comment
Iselin007

They usually begin taking things away then announce a restructuring. They knew all a long they were preparing that new place off shore but didn't want any one to find out until the end.

July 22 2014 at 8:15 PM Report abuse -1 rate up rate down
Iselin007

Microsoft released earnings today however it was not among the companies on the list above.

During the earnings report one frequent guest on CNBC said he could care less an hoped they wack another 18,000 people.

July 22 2014 at 5:55 PM Report abuse -2 rate up rate down Reply
1 reply to Iselin007's comment
weilunion

http://www.dailycensored.com/microsoft-to-lay-off-workers-and-offer-exciting-relocation-plan/

July 22 2014 at 8:32 PM Report abuse rate up rate down Reply
1 reply to weilunion's comment
Iselin007

Ok already. I'll check it out when I get the chance.

July 22 2014 at 8:48 PM Report abuse -1 rate up rate down