U.S. stocks moved higher on Monday as investors prepared for a major week of earnings from heavyweight tech companies.
The Dow Jones Industrial Average rose 100 points, or about 0.3%, while the S&P 500 rose 0.6% to set a new intraday record high. The tech-heavy Nasdaq Composite gained 0.9%, buoyed by Tesla.
Wall Street is coming off a winning week on the back of strong corporate earnings. The blue-chip Dow gained more than 1% last week and closed Friday at a record. The S&P 500 rallied 1.7% last week, also posting its third straight positive week and hitting an all-time high Friday.
Shares of Tesla, which reported record revenue and profits last week, gained more than 9% and saw its market cap surpass $1 trillion after Morgan Stanley hiked its price target on the shares to $1,200 from $900. Rental car company Hertz also announced that it would order 100,000 Tesla vehicles.
Some of the biggest technology companies are slated to report earnings this week, including Facebook, Alphabet, Microsoft, Amazon and Apple. A third of the Dow companies also is set to release quarterly results this week, including Caterpillar, Coca-Cola, Boeing and McDonald’s.
Facebook and Apple turned positive in afternoon trading after falling earlier in the seassion.
“Rising tide of earnings is lifting all the boats and adding fuel to the bull market fire,” said Anu Gaggar, global investment strategist at Commonwealth Financial Network. “The 3Q earnings season is off to a strong start despite concerns about supply bottlenecks and labor shortages.”
Of the 117 companies in the S&P 500 that have reported earnings to date, 84% posted numbers that beat expectations, according to Refinitiv. S&P 500 companies are expected to grow profit by about 35% in the third quarter.
Energy stocks opened higher as West Texas Intermediate crude futures touched $85 per barrel. Shares of Exxon Mobil and Diamondback Energy rose more than 1%.
Entering the final week of October, the major averages have all registered solid gains for the month. The Dow and the S&P 500 are both up more than 5%, while the Nasdaq Composite has climbed 4.4% month to date.
Leading the October rally in the broader market has been the energy sector, which is up 11% this month. Industrials, real estate, materials and financials have all popped at least 7% over the same period.
“Transports, consumer discretionary, and large-cap tech have led the market higher these past two weeks, signaling that growth worries around supply chain constraints are beginning to fade,” said Lindsey Bell, chief investment strategist at Ally Invest.