Stimulus hopes lift Dow, S&P 500
Wall Street got a jolt Tuesday from upbeat earnings, but the Nasdaq was left behind one day after closing at another record high.
Investors were also hopeful as U.S. lawmakers wrangle over another round of stimulus.
The Dow rallied 159 points. The S&P 500 gained 5 but the Nasdaq fell 86.
Jeff Tomasulo, CEO, Vespula Capital describes today’s market action as a classic rotation.
"We have seen the Russell 2000, which is the small-cap index, stay-in firm and holding up almost one percent while the Nasdaq is pretty much flat or negative today, and the same thing in the S&P. For us we look at that as a rotation. That's actually really healthy for the market. People start to take profits in stuff that has gone up tremendously and start to put it into the undervalued or areas where they find value and that's small cap and the S&P 500 and that's the action we are really seeing today."
Coca-Cola led the charge. The global soft-drink behemoth beat profit forecasts and said demand is already rebounding from the "most challenging" quarter of the year. The Dow component rallied more than 2 percent.
Lockheed Martin has dared to do what few other companies have. The defense contractor raised its full-year sales and profit forecasts after topping second-quarter earnings estimates. Higher sales for the F-35 fighter jet was a major factor in the beat. Shares rallied nearly 3 percent.
Tesla shares were downgraded ahead of the electric car maker's Wednesday earnings. One analyst told investors any intermediate good news is already priced into the stock. Tesla shares have enjoyed a rip-roaring rally as of late, surging roughly 300 percent so far this year. The downgrade, however, prompted a 4-1/2 percent drop.
