US stocks have closed mixed with the Dow out front, as a string of solid earnings lured investors to industrials and capital goods.
Weakness in growth and microchip stocks pulled the tech-laden Nasdaq to a nominally lower close.
"We're at a little bit of a point of indecision, where nobody feels particularly strongly about anything," said Michael Green, chief strategist at Simplify Asset Management in Philadelphia. "That reflects itself in reduced reaction to earnings surprise."
Big companies posting upbeat results
Third-quarter earnings season has shifted into overdrive, with corporate giants such as General Motors, GE Aerospace, 3M and Coca-Cola posting generally upbeat results. But with major US stock indexes hovering near record highs and valuations stretched, upbeat results alone could prove insufficient to sustain investor risk appetite.
"The earnings are better than expected as companies continue to gain slightly in terms of margins, which suggests that (companies) have to be passing through the tariffs or pushing the tariffs back onto the importers," Green said, adding "nothing is jumping out today that to say that there's a strong opinion being expressed anywhere."
General Motors' stock surged after the carmaker lifted its forecast and tempered its anticipated tariff hit.
Coca-Cola shares rose after solid consumer demand drove its better-than-expected results, while diversified manufacturer 3M advanced after hiking its full-year forecast, bolstered by its focus on higher margin products and cost controls.
Aerospace and defence companies Lockheed Martin, Northrop Grumman and RTX all raised their forecasts, benefiting from solid demand for war machinery.
So far, 78 of the companies in the S&P 500 have reported. Of those, 87 per cent have beaten Wall Street expectations. Analysts currently foresee aggregate third-quarter S&P 500 earnings growth of 9.2 per cent year-on-year, more robust than their 8.8 per cent estimate as it stood on October 1, according to LSEG data.
High-profile results from Tesla, IBM, Procter & Gamble and Intel are also on tap this week.
According to preliminary data, the S&P 500 lost 0.34 points, or 0.01 per cent, to end at 6,734.79 points, while the Nasdaq Composite lost 36.54 points, or 0.17 per cent, to 22,950.91. The Dow Jones Industrial Average rose 217.02 points, or 0.46 per cent, to 46,923.60.
Shares of Warner Brothers Discovery surged after the company announced it is considering an outright sale, citing interest from several potential buyers, in the latest media shakeup. Late in the session the board rejected an offer from Paramount Skydance.
Government shutdown remains unresolved
The US government shutdown, now in its third week, has left investors, economists and policymakers in the dark in the absence of official data, complicating the efforts of the data-dependent Federal Reserve. Even so, the central bank will implement two more 25-basis-point reductions to its key policy rate by year-end, according to a Reuters poll of economists, who remain divided regarding the Fed's path forward in 2026.
US President Donald Trump also struck a positive tone on trade, saying he expects to reach a "fair deal" with Chinese President Xi Jinping, while downplaying tensions over Taiwan.
Markets will keep an eye on Trump's upcoming meeting with Xi on the sidelines of next week's economic summit in South Korea.
