Stocks are climbing on Wednesday following strong profit reports from some of the world’s biggest names in banking and technology.
UBS Global Wealth Management released a research note on Wednesday morning, citing the trend that early-reporting companies “tend to have a good relationship with how the rest of earnings season plays out.” With a little less than 10% of the S&P 500 market cap reporting, the team led by David Lefkowitz, Head of US Equities, characterized the results as “decent,” with 80% beating sales estimates and just over 70% beating earnings-per-share estimates. That’s better than normal, UBS said, but so the scope of these beats is a little light as the median company is beating earnings by 2.2%, versus the historical average of 3.5%.
Overall, UBS added, it sees third quarter earnings season as supportive of the bank’s view that “the bull market remains intact,” driven by the combination of durable earnings growth and Fed rate cuts.
Tech stocks helped lead the way on Wednesday, thanks in part to a profit report from ASML, which is a major supplier to the semiconductor industry. The Dutch company said it expects its revenue for 2025 to be 15% above last year’s, while next year’s should be at least as high as this year’s.
“On the market side, we have seen continued positive momentum around investments in AI,” CEO Christophe Fouquet said, “and have also seen this extending to more customers.” That’s key when worries have been high that a bubble may be forming in artificial-intelligence technology, with too much investment flowing in akin to the 2000 dot-com frenzy.
They helped offset a 4% loss for PNC Financial. It reported a stronger-than-expected profit for the latest quarter, but it also gave a forecast for upcoming earnings that some analysts said was below expectations.
One big winner because of all the uncertainty has been gold, and its price rose 1.3% to top $4,200 per ounce. It’s up nearly 60% for the year so far as investors look to buy something that can offer protection from trade wars, real military wars and the prospect of higher inflation coming because of mountains of debt being amassed by the U.S. and other governments worldwide.
In stock markets abroad, indexes were mixed in Europe after a stronger finish in Asia.
South Korea’s Kospi jumped 2.7%, and France’s CAC 40 rose 2.1% for two of the world’s bigger moves.
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AP Business Writers Matt Ott and Elaine Kurtenbach contributed.
