S&P 500 Climbs as Tech Moves Off Session Lows Ahead of Busy Earnings Week

By Yasin Ebrahim

Investing.com – The S&P 500 climbed Tuesday, as cyclical sectors including energy racked up gains, while tech stocks moved off session lows ahead of another busy week for the sector.

S&P 500 rose 0.6%, the Dow Jones Industrial Average added 0.7%, or 237 points, the Nasdaq added 0.52%.

Growth corners of the market found favor into the close, with Apple and Microsoft paring some losses, as investors awaited another wave of quarterly results from the tech heavyweights including Alphabet-parent Google due to report after the market closes.

Ahead of the results from Alphabet (NASDAQ:GOOGL), some on Wall Street flagged reason for caution, citing concerns about the impact of Apple’s privacy changes.

“While investors remain relatively bullish on GOOGL heading into the print, our view is a bit more cautious on two fronts given our ad checks and spots of investor checks having detected YouTube ATT/IDFA headwinds,” RBC said in a note.

Facebook (NASDAQ:FB) and Amazon (NASDAQ:AMZN), which report earnings on Tuesday and Friday respectively, were also higher. 

Value stocks including energy, industrials and materials underpinned the broader market, with energy leading the way, supported by a jump in shares of energy giant Exxon Mobil (NYSE:XOM).

Exxon reported mixed fourth-quarter results as revenue fell short, but the oil giant also announced a new $10 billion stock buyback program, sending its shares more than 6% higher.

United Parcel Service (NYSE:UPS) delivered better-than-expected quarterly results and upbeat, sending its shares more than 14% higher.

In deal activity, AT&T (NYSE:T) detailed plans to spin off its WarnerMedia business to Discovery (NASDAQ:DISCA) in a $43 billion deal.

The telecoms giant, however, also said it cut its dividend of $1.11 per share, down from $2.08 per share, and at the lower end of previously announced range. Its shares slipped 4%.

New York Times (NYSE:NYT), meanwhile, said it would acquire viral word game Wordle for an undisclosed amount. Its shares were up more than 3%.

On the economic front, U.S. manufacturing activity slowed, but by less than expected.

ISM manufacturing data  for January showed a decline to 57.6, and deeper dive into the data pointing to easing supply chain problems, though at a modest pace.

A reading above 50 in the ISM index indicates an expansion in manufacturing, which accounts for about 12% of the U.S. economy.

“The data suggest marginal progress in the fight to rebuild inventories and work through order backlogs […] but the magnitude of the changes in these indexes was quite small,” Jefferies said.

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“There is still plenty of evidence that supply chain problems persist.”