U.S. stocks rose to record highs on Monday as investors prepared for a major week of earnings from heavyweight tech companies.
The Dow Jones Industrial Average rose 64.13 points, or 0.18%, to 35,741.15 for another record close. The S&P 500 rose 0.47% for its own record high of 4,566.48. The tech-heavy Nasdaq Composite led the way with a gain of 0.90% to 15,226.71, buoyed by a historic day for Tesla.
The electric vehicle pioneer, which reported record revenue and profits last week, gained more than 12% and saw its market cap surpass $1 trillion after Morgan Stanley hiked its price target on the shares to $1,200 from $900. Rental car company Hertz also announced that it would order 100,000 Tesla vehicles.
The sharp move for the stock helped the market start the week off strong ahead of a busy week of earnings. Tech giants Alphabet, Microsoft, Amazon and Apple are set to report this week, along with Dow components Caterpillar, Coca-Cola, Boeing and McDonald’s.
“This is a make-it or break-it type of week in earnings season. Our expectation is for positive results,” said Alex Chaloff, co-head of investment strategies at Bernstein Private Wealth Management. Chaloff added that he expected tech stocks to start performing well again after taking “a breather” in recent months.
Shares of Facebook rose 1.3% after sliding in morning trading. Apple also erased early losses to close nearly flat, while Amazon and Microsoft dipped less than 1%.
Energy stocks were an area of strength for the market on Monday as West Texas Intermediate crude futures touched $85 per barrel. Shares of Exxon Mobil rose nearly 2%, while Chevron rose 0.9%.
Wall Street entered Monday following a winning week on the back of strong corporate earnings. The blue-chip Dow gained more than 1% last week and closed Friday at a record. The S&P 500 rallied 1.7% last week, also posting its third straight positive week and hitting an all-time high Friday.
Of the 117 companies in the S&P 500 that have reported earnings to date, 84% posted numbers that beat expectations, according to Refinitiv. S&P 500 companies are expected to grow profit by about 35% in the third quarter.
“Rising tide of earnings is lifting all the boats and adding fuel to the bull market fire,” said Anu Gaggar, global investment strategist at Commonwealth Financial Network. “The 3Q earnings season is off to a strong start despite concerns about supply bottlenecks and labor shortages.”
With four trading days left in October, the major averages have all registered solid gains for the month. The Dow and the Nasdaq Composite are both up more than 5% month to date, while the S&P 500 has gained 6%.