Tesla lifts S&P 500 ahead of tech earnings wave

(Reuters) – The S&P 500 and Nasdaq climbed on Monday, fueled by Tesla ahead of the electric car maker’s quarterly report, which kicks off this week’s results from several heavyweight growth companies.

FILE PHOTO: The New York Stock Exchange is pictured amid the coronavirus disease (COVID-19) pandemic in the Manhattan borough of New York City, New York, U.S., April 16, 2021. REUTERS/Carlo Allegri

Tesla Inc advanced 1.3%, with analysts expecting the company to report a rise in first-quarter revenue following record deliveries. Its results are due after markets close.

Companies that constitute about 40% of the S&P 500’s market cap report from Tuesday through Thursday, including Microsoft Corp, Google parent Alphabet Inc, Apple Inc and Facebook Inc. Shares of the companies also rose.

Seven of the 11 major S&P 500 sectors were trading higher, with the materials index gaining 0.7%, while utilities and consumer staples led declines.

Of 124 companies in the S&P 500 that have reported so far, 85.5% have topped analysts’ earnings estimates, with Refinitiv IBES data now predicting a 34.3% jump in profit growth.

“We’re way above the average for firms reporting earnings above estimates. More important than the fact that they are beating on estimates is that they are raising their expectations and outlooks going forward, and that’s giving the markets a nice boost,” said Sal Bruno, Chief Investment Officer at IndexIQ.

Investors will monitor a two-day Federal Reserve meeting beginning Tuesday, with the U.S. central bank expected to shine some light on whether the employment landscape has affected its plan to leave interest rates near zero for an extended time and to continue buying $120 billion in bonds each month.

Also on investors’ radar is a reading of first-quarter gross domestic product later this week to gauge the pace of economic recovery in the United States.

The Dow Jones Industrial Average was down 0.05% at 34,027.49 points, while the S&P 500 gained 0.28% to 4,191.78.

The Nasdaq Composite added 0.88% to 14,139.80.

Market participants are also watching out for any fresh developments on U.S. President Joe Biden’s tax plan after reports last week said he would seek to nearly double the capital gains tax to 39.6% for wealthy individuals.

Cryptocurrency and blockchain-related firms including Riot Blockchain and Marathon Patent Group rose more than 5% each as bitcoin snapped five straight days of losses.

Advancing issues outnumbered declining ones on the NYSE by a 1.93-to-1 ratio; on Nasdaq, a 2.34-to-1 ratio favored advancers.

The S&P 500 posted 105 new 52-week highs and no new lows; the Nasdaq Composite recorded 146 new highs and 18 new lows.

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