By a smidgen, S&P breaks record
By The Associated Press
Published: Monday, Oct. 21, 2013, 8:15 p.m.
NEW YORK — The Standard & Poor's 500 index eked out the smallest of gains to set a record high on Monday as investors assessed third-quarter earnings news.
Earnings will hold investors' attention this week as major American companies, including McDonald's, Boeing and Procter & Gamble report their results. Rising profits have been a key support for the rally in stocks.
Toymaker Hasbro and the V.F. Corporation, which owns clothing brands including Wrangler and The North Face, were among the biggest gainers in the S&P 500. Both reported earnings that beat analysts' expectations. McDonalds dipped as it reported disappointing revenue.
The S&P 500 closed up a fraction of a point at 1,744.66, its third consecutive record close. Stocks climbed last week when Washington reached a deal to end a 16-day government shutdown and avert a default on the nation's debt.
The index is up 22 percent for the year, putting it on track for its best year since 2009.
The Dow Jones industrial average edged down 7.45 points, or 0.1 percent, to 15,392.20. The Nasdaq composite rose 5.77 points, or 0.2 percent, to 3,920.05.
Stocks will likely continue adding to their gains, at least until the end of the year, as investors get more confident that the market's rally is sustainable, said Joe Bell, a senior equities analyst at Schaeffer's Investment Research.
“We've had a pretty decent run here,” Bell said. “It wouldn't surprise me if we saw the momentum slow a bit through the end of October and then have a nice rally through November and December.”
McDonald's fell 61 cents, or 0.6 percent, to $94.59 after the world's biggest hamburger chain's revenue fell short of Wall Street analysts' expectations.
Hasbro surged after reporting that its net income rose 17 percent as sales increased. Its adjusted results and revenue topped analysts' estimates. The stock climbed $2.48, or 5.2 percent, to $49.72. V.F. Corporation rose $6.93, or 3.4 percent, to $211.23 after its earnings beat analysts' expectations.
Netflix jumped in after-hours trading after the company said its net income quadrupled to $32 million, or 52 cents a share. That beat analyst expectations for 48 cents a share.
Companies in the S&P 500 are expected to report earnings growth of 3.2 percent for the July-to-September period, according to the latest data from S&P Capital IQ. About 60 percent of companies that have reported earnings have beaten analysts' expectations.
“Earnings so far have been excellent,” said Jerry Braakman, chief investment officer of First American Trust. “Earnings are coming in and beating (expectations) by a penny here and there, and we're very comfortable with that.”
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