U.S. stocks traded higher Monday, following on from a record closing high for the Dow on Friday, as investors enter the busiest week of the third quarter earnings season with a warning on interest rates and further signals of inflationary pressures in the months ahead.
Around 165 S&P companies will report September quarter profits this week, including a host of big tech companies that comprise more than a fifth of the benchmark's overall weight: Facebook (FB) - Get Free Report, Microsoft (MSFT) - Get Free Report, Apple (AAPL) - Get Free Report, Amazon (AMZN) - Get Free Report and Google parent Alphabet (GOOGL) - Get Free Report.
With 117 companies reporting so far, collective S&P 500 profits are set to rise 34.8% from last year to $430.3 billion, with fourth quarter earnings forecast to rise another 22.8% to $435.3 billion.
- Stocks Mixed, China Warns on Delta, PayPal & Pinterest, Tom Brady's 600 TDs - 5 Things You Must Know
The busy slate will likely occupy the markets' attention even as Federal Reserve policymakers push for changes to the central bank's approach to inflation amid faster -- and longer -- than forecast inflation rates spurred by supply shortages, a surge in energy prices and ongoing tightness in the labor market.
"I do think it's time to taper; I don't think it's time to raise rates," Federal Reserve Chairman Jerome Powell told a virtual conference last week, setting high expectations for the central bank's next meeting, which begins on November 2.
The Dow Jones Industrial Average was marked 35 points higher in late-morning trading, with the broader S&P 500 up 14 points at the start of trading. The tech-focused Nasdaq Composite gained 85 points as benchmark 10-year Treasury note yields rose to 1.67% and Tesla TSLA surged to a fresh all-time peak.
In terms of individual stocks, Pinterest (PINS) - Get Free Report shares fell sharply lower after PayPal (PYPL) - Get Free Report, which was linked to a $45 billion takeover of the social media company last week, said it is not pursing an acquisition of the group.
Facebook fell 1% after a trove of papers obtained by a company whistleblower that highlighted everything from concern over the declining interest of teen users on the social media platform to its role in the January Capitol riots were released ahead of the group's third quarter earnings
Tesla (TSLA) - Get Free Report shares, meanwhile, surged 5%, taking the clean-energy carmaker to a fresh all-time high, after analysts at Morgan Stanley boosted their price target on the group following record third quarter profits and deliveries.
Tesla shares opened with a market value of around $938 billion, overtaking Facebook as the fifth most-valuable U.S. company listed on the S&P 500.
In other markets, global oil prices moved back to seven-year highs amid supply shortages and surging energy prices in Europe and China, with WTI futures for December rising $1.04 from last week's close to change hands at $84.80 per barrel.
The U.S. dollar index, which tracks the greenback against a basket of six global currencies, was marked 0.21% higher at 93.838 while benchmark 2-year note yields traded at 0.456%, some 20 basis points north of the Fed Fund rate range of 0% to 0.25%.