S&P 500, Dow rise on boost from big bank earnings

The S&P 500 has risen and the Dow has hit a record high, driven by gains in major banks following third-quarter results, while mixed producer price data backed expectations for a 25-basis-point rate cut by the Federal Reserve in November.

However, the tech-heavy Nasdaq lagged due to an 8.1 per cent drop in Tesla, after the EV maker unveiled its long awaited robotaxi, but did not provide details on how fast it could ramp up production or deal with potential regulatory hurdles.

The Dow Jones Industrial Average rose 180.22 points, or 0.42 per cent, to 42,634.34, the S&P 500 gained 13.53 points, or 0.23 per cent, to 5,793.58, and the Nasdaq Composite lost 16.74 points, or 0.09 per cent, to 18,265.31.

The Dow touched an intraday record high, outperforming its peers as major bank stocks boosted the index.

The Financials index also hit a record high, climbing 1.8 per cent and leading sectoral gains, while S&P 500 Banks stocks ticked 4.5 per cent higher.

Major financial companies kicked off the earnings season on the day, with JPMorgan Chase rising five per cent after the lender reported higher-than-expected third-quarter profit and raised its annual interest income forecast.

Wells Fargo rose 5.6 per cent, after its profit also beat analysts' expectations. BlackRock gained 3.9 per cent after the asset manager reported its assets under management had hit a record high for the third straight quarter.

Meanwhile, data from the US Department of Labor showed the Producer Price Index for final demand was unchanged on a monthly basis in September, compared to the 0.1 per cent rise expected by economists polled by Reuters.

However, core PPI, which excludes the volatile food and energy components, stood at 2.8 per cent on an annual basis, slightly higher than the estimated 2.7 per cent rise.

Traders kept bets steady on a 25-basis-point rate cut from the US central bank in November, pricing in a nearly 84 per cent chance, according to CME's FedWatch.

"The annual numbers are a little higher and it's going to take a little time to go through why that is the case, (but) there's nothing specifically in this number to make markets... change the narrative," said Steve Sosnick, chief market strategist at Interactive Brokers.

All three major indexes were on track to notching their fifth consecutive week of gains. It would be the best winning streak for the Dow in eight months and the best for the Nasdaq since May.

With major indexes trading around record highs and the benchmark S&P 500 up more than 21 per cent year-to-date, the third-quarter results will test if 2024's rally can be sustained amid uncertainty over monetary policy, geopolitical risks and the upcoming US presidential elections.

Meanwhile, a preliminary reading of the University of Michigan's October consumer sentiment index stood at 68.9, compared with analysts' estimate of 70.8.

Also on deck are speeches from Fed officials Michelle Bowman, Lorie Logan and Austan Goolsbee through the day.

Advancing issues outnumbered decliners by a 2.23-to-1 ratio on the NYSE, with 144 new highs and 12 new lows.

On the Nasdaq, 2,357 stocks rose and 1,222 fell as advancing issues outnumbered decliners by a 1.93-to-1 ratio.

The S&P 500 posted 40 new 52-week highs and one new low, while the Nasdaq Composite recorded 62 new highs and 47 new lows.