The Dow Jones Industrial Average closed higher on Wednesday, recovering some ground, while both the S&P 500 and Nasdaq slipped due to declines in megacap technology stocks. At the same time, bank stocks surged, fueled by positive quarterly earnings, particularly from Morgan Stanley.
Morgan Stanley’s stock rose 6.7% following strong third-quarter earnings, which echoed solid profits from peers like JPMorgan Chase, boosted by higher investment banking revenue. Similarly, First Horizon gained 3.3%, and US Bancorp climbed 5% after reporting third-quarter results. The Financials sector gained 0.7%, with the Banks index up 1.1% and regional banks rising 1.3%.
In contrast, megacap tech stocks weighed on the market, with Meta Platforms dropping 1.5%, Apple declining 1.4%, and Microsoft slipping 1.3%. The Communication Services sector also fell 0.7%, further dragging the market.
The Dow rose 133.14 points (0.31%) to 42,872.78, while the S&P 500 lost 5.00 points (0.08%) to 5,810.69, and the Nasdaq Composite fell 71.98 points (0.39%) to 18,243.21. The Russell 2000 small-cap index outperformed, gaining 0.83%.
Semiconductor stocks were mixed, with Nvidia rising 0.5% after a significant decline the previous day. However, ASML Holding dropped 5.3% after cutting its 2025 forecast, and Intel fell 3.3% following a product review recommendation by the Cybersecurity Association of China.
Despite the mixed performance, investors remain optimistic about corporate earnings from banks and other sectors, with further reports expected later in the week. United Airlines surged 8% after forecasting strong fourth-quarter profits and announcing a $1.5 billion share buyback program. JB Hunt also rose 6.2% after beating third-quarter profit estimates.
The market is also eyeing key economic data, including retail sales and industrial production figures, due Thursday, which will provide insight into the health of the US economy. With the Federal Reserve likely to cut rates by 25 basis points in November, expectations for a sustained market rally remain high.
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