US stocks rebounded Monday as investors turn their attention to the virtual summit between US President Joe Biden and Chinese President Xi Jinping and try to look past a continued spike in inflation.
The two leaders will discuss how to manage the competition between the superpowers, the White House said in a statement.
The benchmark S&P 500 rose Monday after closing with at a loss last week, which broke a five-day winning streak. The tech-heavy Nasdaq-100 and the Dow Jones Industrial Average both inched higher as well.
Here’s where US indexes stood at the 9:30 a.m. ET on Monday:
Despite rising inflationary pressures exacerbated by global supply chain disruptions, corporate earnings for the third quarter have mostly outperformed Wall Street’s expectations.
Data from Fundstrat shows that of the 91% of S&P 500 companies that reported third-quarter earnings so far, 81% have beat profit estimates by a median of 9%, while 72% have beat revenue estimates by an average of 5%.
Still, corporate executives are sounding a cautious note on the impact of rising prices on future earnings. The number of S&P 500 companies mentioning inflation on their earnings calls rose to its highest in 10 years in the third quarter, according to data from FactSet.
285 companies have cited the term “inflation,” the highest number since 2010, with with around 40 S&P 500 companies yet to report.
Bond yields slipped Monday after rising sharply the previous week when the release of inflation data raised expectations that the Federal Reserve would have to hike interest rates sooner than expected.
The yield on 10-year Treasury slipped to 1.578% on Monday compared to Friday’s 1.583%. Bond yields and prices move in opposite directions.
Oil prices tumbled as investors weighed the possibility that Biden may authorize the release of strategic reserves.
Gold slipped slightly by 0.04% to $1,864.56 per ounce.
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