UKX FTSE 100 Index

By Avantika Chilkoti and Karen Langley 

The S&P 500 set a new intraday high Monday to kick off a busy week featuring a flurry of corporate earnings, a Federal Reserve meeting and the October jobs report.

The index climbed 0.6% to 3039.91, passing its previous record of 3027.98 from July 26. The Dow Jones Industrial Average gained 0.5%, and the technology-heavy Nasdaq Composite added 0.9%, putting both indexes within about 1% of their records.

Hopes for lower interest rates and a resolution to the long-simmering trade dispute between the U.S. and China have propelled stocks this year after a brutal selloff to end 2018. The S&P 500 is up 21% in 2019 and 12% from a year ago.

But major indexes have largely traded sideways since the beginning of last year as signs of slowing global growth and tit-for-tat tariffs between the U.S. and China have dented corporate investment and spurred anxiety among investors.

Nearly 150 companies in the S&P 500, including General Motors, Facebook and Apple, are on tap to report results this week, and investors will be listening carefully for insight into how the trade war is affecting businesses. Most reports have beaten the low expectations of analysts, but earnings are still on track to fall 3.8% from a year earlier, according to FactSet.

"For the market to move higher from here, you would definitely need earnings upgrades," said Anik Sen, global head of equities at PineBridge Investments. "The earnings upgrades are going to be more company-specific. A lot of management teams have been investing in productivity."

The Federal Reserve, meanwhile, is expected to cut interest rates for the third time this year at the conclusion of its meeting Wednesday to cushion the economy against the effects of slower growth.

Investors will also be paying close attention to the next U.S. jobs report Friday for clues on the health of the economy.

Fast-moving geopolitical events are also holding back corporate performance, said Esty Dwek, a strategist at Natixis Investment Managers

"It's a confirmation that there's a lot of uncertainty, and the more you can remove some of this uncertainty the more you'll have better guidance and confidence in terms of hiring and investing," Ms. Dwek said.

Corporate news drove swings in individual stocks Monday. Shares of Tiffany surged 31% after LVMH Moët Hennessy Louis Vuitton confirmed it is talks for a potential takeover that would value the iconic jewelry brand at $14.5 billion. Shares in LVMH gained 0.3%.

Microsoft gained 2.2% after the software company won a contract worth up to $10 billion over the next decade from the Pentagon. AT&T added 5% after the company struck a truce with an activist investor.

In Europe, the pan-continental Stoxx Europe 600 index added 0.3%. HSBC Holdings was among the biggest losers in Europe, shedding 3.6% after the bank dropped its main financial target and said it would speed up plans to revamp its U.K., U.S. and European businesses.

The U.K.'s FTSE 100 gauge ticked up 0.1% as U.K. Prime Minister Boris Johnson urged lawmakers to support his push for a Dec. 12 general election as a way to clear a path to Brexit. European Union leaders agreed to a three-month extension to the Brexit deadline, extending the political uncertainty until Jan. 31.

Asian markets had a stronger start to the week. The Shanghai Composite Index gained 0.9% and Hong Kong's benchmark Hang Seng Index climbed 0.8%.

The yield on 10-year Treasurys rose to 1.853%, from 1.805% Friday, as investors anticipate the Federal Reserve will cut interest rates again this week.

Write to Avantika Chilkoti at Avantika.Chilkoti@wsj.com

(END) Dow Jones Newswires

October 28, 2019 11:41 ET (15:41 GMT)

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