U.S. stocks fluctuated, with the Standard & Poor’s 500 Index poised for its best week since 2013, after a doctor in New York tested positive for Ebola and investors weighed earnings from companies including Amazon (AMZN).com Inc. and United Parcel Service Inc.
Amazon slid 8 percent after posting a loss that was wider than analysts estimated. Pandora Media Inc. plunged 9.4 percent after the largest Internet-radio service reported a slowdown in user growth. Microsoft Corp. climbed 4.1 percent after
revenue beat predictions. UPS gained 2.3 percent as profit topped estimates.
The S&P 500 added 0.1 percent to 1,952.82 at 9:32 a.m. in New York. The Dow Jones Industrial Average climbed 12.30 points to 16,690.20.
“I remain unconvinced that this is a back to the races environment,” James Abate, who oversees $1 billion as chief investment officer at Centre Funds in New York, said in a phone interview. “Sentiment got way too complacent in September and we’ve had overseas weakness concerns about Europe and China, earnings are solid but revenue growth is down from the second quarter, and Ebola has been another snowflake in that avalanche.”
The S&P 500 rallied 1.2 percent yesterday and is up 3.4 percent this week, heading for its biggest rally since January 2013 as corporate results topped projections and data signaled stronger growth in the global economy.
Fed Stimulus
The Federal Reserve has been gradually winding down its $85 billion plan of monthly bond purchases since January and is poised to stop the final $15 billion at the end of its Oct. 29 meeting. The central bank is watching data to determine the timing of any interest rate increase.A report at 10 a.m. from the Commerce Department in Washington may show new-home sales fell to a 470,000 annualized rate last month, after reaching a six-year high of 504,000 in August, according to economist forecasts.
Benchmark equity indexes pared gains yesterday, while bonds rose the most in a week today after a New York City doctor tested positive for Ebola after returning from aid work in West Africa. Authorities are tracking his movements even as they reassure the public the risk of contracting the disease is minimal.
The S&P 500 (SPX) has risen five times in the past six days, pushing the gauge up 4.7 percent since Oct. 15 and recouping about half the losses from a selloff that began in mid-September. The equity benchmark is still down 3 percent from a record.
Almost 80 percent of S&P 500 companies that have released results this season beat profit projections, while 61 percent surpassed revenue estimates.
“We’re still close to all-time highs, and the market is very sensitive to these highly valued stocks like Amazon,” Jasper Lawler, a market analyst at CMC Markets Plc in London, said by telephone. “If valuations aren’t getting justified by earnings when the stock market may not be supported by quantitative easing in five days’ time, these companies that miss estimates are going to get pummeled.”
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