After a rocky start with the Dow diving over 250 points right out the gate, it was a straight trajectory up as everyone rushed back into tech seemingly optimistic about Q3. The initial plunge was attributed to bad news from China which reported its slowest growth in a year, but the jitters that triggered were quickly put aside on hopes that a much more solid Q3 will be evident by the end of this week as by then there will be a much bigger slate of reports from a diverse set of industries.  Q3 earnings are now expected to show 32% growth over last year and there was more good news with the consumer discretionary sector being the biggest gainer showing that spending is still solid. The biggest decliners were in the defensive sectors which also pointed to optimism. As more Q3 filters in, volume remains on the down-low at 9.1 billion. 

MON  OCTOBER 18, 2021  5:59 PM 

S&P, Nasdaq enjoy boost from big tech firms, Dow ends a hair lower

By Devik Jain, Shreyashi Sanyal, Sinéad Carew

DJ: 35,294.76  +382.20       NAS: 14,897.34  +73.91        S&P: 4,471.37  +33.11     10/15

DJ: 35,258.61  -36.15          NAS: 15,021.81  +124.47      S&P: 4,486.46  +15.09     10/18

(Reuters) - The S&P and Nasdaq closed higher on Monday with the biggest boosts from the highest-profile technology and communications companies while investors eyed product news from Apple Inc and appeared optimistic about the third-quarter earnings season.  After a weak start following disappointing economic data from China, the S&P and Nasdaq gathered steam in late morning with gains in FAANG stocks - Facebook Inc, Apple, Amazon.com Inc, Netflix Inc, Alphabet Inc’s Google - as well as Microsoft Corp.

Apple shares closed 1% higher after the company made a splash by unveiling new Mac laptop computers with more powerful processor chips.  Facebook shares, under pressure recently, closed up more than 3% with some positive reports out including its plans to create 10,000 jobs in Europe to help build the so-called metaverse - an online world.

With just a small minority of companies having reported quarterly results so far, investors were hopeful for some good news in the days and weeks ahead.  “You’re going to get a heavier slate of earnings reports this week from a diverse set of industries,” said Michael James, managing director of equity trading at Wedbush Securities in Los Angeles, adding, “the path of least resistance remains higher going into earnings season for large-cap tech.”

The Dow Jones Industrial Average fell 36.15 points, or 0.1%, to 35,258.61, the S&P 500 gained 15.09 points, or 0.34%, to 4,486.46 and the Nasdaq Composite added 124.47 points, or 0.84%, to 15,021.81.

Forecast-beating results from big U.S. lenders last week had set a positive tone for third-quarter earnings season, with analysts expecting S&P 500 earnings to show a 32% rise from a year ago, according to Refinitiv data.  The solid start likely helped investors shrug off uneasiness from earlier in the day after China recorded its slowest pace of economic growth in a year for the third quarter, hurt by power shortages and wobbles in the property sector. [MKTS/GLOB]  Other top contributors to the S&P’s gains were Tesla Inc ahead of its earnings report this week, Amazon, which added 1% and chipmaker Nvidia Corp, which closed up 1.6%.

While technology, closing up 0.9%, was the S&P’s top index point boost, consumer discretionary was the biggest percentage gainer, climbing 1.2% and communications services followed with a 0.7% gain.

Johnson & Johnson, Netflix, Verizon Communications Inc and oilfield services company Baker Hughes Co are also due to report quarterly results this week.  But while mega tech gainers were strong enough to boost the S&P and the Nasdaq, optimism was not widespread with four industry sectors closing in the red.  Of the S&P’s 11 major sectors, seven closed higher. The biggest decliners were utilities, down 0.97%, and healthcare, down 0.7%.  Shares of Walt Disney Co closed down 3% after Barclays downgraded the media giant’s stock to “equal weight” from “overweight.”

Declining issues outnumbered advancing ones on the NYSE by a 1.09-to-1 ratio; on Nasdaq, a 1.24-to-1 ratio favored decliners.  The S&P 500 posted 39 new 52-week highs and no new lows; the Nasdaq Composite recorded 65 new highs and 113 new lows.

Volume on U.S. exchanges was 9.1 billion shares, compared with the 10.3 billion average for the last 20 trading days.