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By Nicholas
Jasinski | Tuesday, November 3 Manufactured
Gains. Investors enjoyed a broad rally today,
with 451 of the S&P 500's
components closing in the green today. The index overall rose 1.8%, the Nasdaq
Composite added 1.9%, and the Dow
Jones Industrial Average jumped 2.1%. The rally
took an economically optimistic tone, with industrials and financials
the best-performing groups in the S&P 500. Oil prices rose and bond
yields fell. That could
be due to some mean reversion, as stocks continued to bounce back from their
worst week since March. It could also be thanks to a bit of early
election uncertainty fading away, with no last-minute surprises or
meaningful tightening of the polls. (More on that below.) Earnings
reports continued today, with all 14 S&P 500 companies' results beating
consensus estimates on their top and bottom lines. Industrial companies in
particular outperformed expectations, helping to boost the sector overall. Eaton, Emerson Electric, Johnson
Controls International, and AGCO all
did handily better than Wall Street had forecast today. Add to that
yesterday's October Manufacturing
Purchasing Managers’ Index from the Institute
for Supply Management. That came in at 59.3,
versus the 56 consensus estimate. Guidance
from industrial firms has been cautiously optimistic, with management teams
citing the Covid-19 pandemic as a continued wildcard. But the rebound in
the global industrial economy is showing up in the numbers. That could
be the needed catalyst to set off a lasting rally in industrial
stocks, Al Root wrote
today. The group has handily outperformed the broader market and
fist-half 2020 winners like technology over the past few months. But Al noted
that industrials valuations remain attractive relative to tech in
particular. Other
third-quarter results today came from Fox,
Gartner,
and Zebra Technologies.
On deck to report tomorrow are another 23 S&P 500 firms, including Expedia
Group, Hilton
Worldwide Holdings, and Qualcomm. Follow Barron's Election Night Coverage Barron's reporters and editors are on duty tonight,
bringing you the latest results as they come in, with market reactions and
what it all means for investors. Find our live blog here
and get all the coverage at barrons.com. |
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DJIA: +2.06% to 27,480.03 The Hot
Stock: Arista
Networks +15.4% Best Sector:
Industrials +3% |
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