This Day On The Street
Continue to site right-arrow
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Stock Market Today: Earnings, Leading Indicators Signal U.S. Strength


NEW YORK (TheStreet) -- After a bout of market volatility at the beginning of October created fears of a U.S. slowdown, corporate earnings and leading economic indicators were pointing to steady growth.

Jobless claims released Thursday remained near decade lows and economic bellwethers like 3M (MMM) , Caterpillar (CAT) , General Motors (GM) and the airline industry reflected strong business and consumer demand in the U.S.

Those earnings reports, taken with an unexpected rise in manufacturing data in China and Europe, propelled stock markets sharply higher on Thursday. The S&P 500 rose more than 1.4% to 1,955.00, with the Nasdaq and Dow Jones Industrial Average posting gains of 1.68% and 1.49%, respectively.

Must Read: Warren Buffett's Top 10 Dividend Stocks

Initial jobless claims rose 17,000 last week to 283,000, slightly exceeding forecasts. Nonetheless, claims reflect significant improvement in the U.S. labor market. The four-week average on claims now stands at its lowest level since mid-2000.

Flash MarkIt U.S. Manufacturing PMI fell more than expected to 56.2, below estimates of 57.0, according to the median forecast compiled by Bloomberg. The reading was also the lowest in nine months. That data, however, had little impact on early stock market gains on Thursday.

Shares of Caterpillar surged more than 5% in early trading after the company said it earned $1.72 a share in the third quarter, sharply exceeding estimates of $1.36 a share. The industrial equipment manufacturer, which counts on international markets for more than half of its sales, also increased its profit forecasts for coming quarters.

Materials giant 3M (MMM) was leading the Dow higher after also beating third-quarter earnings estimates.

Earnings from General Motors also gave a positive read on the economy. Earnings from the automaker were bolstered by stronger-than-forecast U.S. sales. Car sales in North America rose more than 7% in the quarter, indicating continued consumer confidence in the automaker and strength in U.S. economic demand.

GM reported third-quarter earnings of 97 cents a share on $39.3 billion in revenue. Shares in GM were rising more than 1% to $31.65 in afternoon trading.

Airline stocks were also rising after Southwest (LUV) and JetBLue (JBLU) reported third-quarter profit that showed rising earnings in the industry after years of consolidation. UnitedContinental (UAL) fell 1%, erasing sharp losses in early trading.

Comcast (CMCSA) and Under Armour (UA) beat third-quarter earnings, while agriculture giant Potash (POT) increased its guidance. Homebuilder PulteGroup (PHM) reported in-line third-quarter earnings and pharmaceuticals Celgene (CELG) and Eli Lilly (LLY) reported mixed results.

Comcast was rising more 3% while Under Armour reversed early losses. (AMZN) will report earnings after the markets close on Thursday, with analysts expecting the e-commerce giant to report an adjusted loss of 3 cents a share on sales of $20.84 billion. The company may also provide commentary on its expectations for the holiday season, potentially impacting stock prices across the retail industry.

A report from Bloomberg pushed oil markets higher in midday trading after an unnamed source told the news agency Saudi Arabian oil supplies dropped 328,000 barrels a day in September. Oil rose from two-year lows on the report.

West Texas Intermediate Crude was trading 1.48% higher at $81.71, while ICE Brent Crude was trading 1.79% higher at $86.23. Oil tumbled on Wednesday afternoon, pushing stock markets lower for the day, after the Energy Information Administration reported a greater-than-forecast in inventories.

HSBC said Wednesday evening that monthly Chinese manufacturing PMI rose to 50.4, exceeding forecasts of 50.2, according to Bloomberg data, giving new insight on the country's growth prospects. Earlier this week, the Chinese statistics bureau said gross domestic product rose 7.3% in the July-September quarter.

In Europe, manufacturing PMI rose to 50.7, sharply exceeding forecasts of a drop to 49.9, possibly indicating that Eurozone economic activity is stronger than some had feared.

A reading below 50 signals economic contraction. German manufacturing PMI also reflected rising economic activity. U.S. manufacturing PMI will be released at 9:45 a.m. EDT, with economists forecasting a slight drop to 57.

Friday will be another busy day of corporate earnings and economic data.

The U.K. will report third-quarter gross domestic product figures, potentially shedding light on any prospective interest rate increases from the Bank of England. Growth in the U.K. is expected to have risen 3% on an annualized basis in the third quarter.

In the U.S., the National Association of Realtors will release new home sales figures for September on Friday morning. New home sames are expected to be 470,000, a slight drop from August’s reading of 504,000.

Must Read: Warren Buffett's Top 10 Dividend Stocks

-- Written by Antoine Gara in New York

Follow @AntoineGara

Select the service that is right for you!

Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 16,713.87 +252.55 1.53%
S&P 500 1,954.33 +27.22 1.41%
NASDAQ 4,457.7820 +74.9350 1.71%

Brokerage Partners

Rates from

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs