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Stock Market Recap for October 29, 2024: A Day of Gains and Geopolitical Shifts
The U.S. stock market closed on a positive note on Monday, October 28, 2024, as investors geared up for a slew of big tech earnings reports and significant economic data releases. Here’s a detailed breakdown of the key events and market movements that defined the day.
Benchmark Performance
The major indices all ended in positive territory. The Dow Jones Industrial Average (DJI) rose by 0.7%, or 273.17 points, to close at 42,387.57. Of the 30 stocks in the index, 23 posted gains, while seven declined.
The Nasdaq Composite, heavily influenced by tech stocks, advanced by 48.58 points, or 0.3%, to end the day at 18,567.19. The S&P 500 also saw a gain, increasing by 0.3%, or 15.4 points, to finish at 5,823.52. Nine out of the ten sectors of the S&P 500 closed in positive territory, with the Financials Select Sector SPDR (XLF), Materials Select Sector SPDR (XLB), and Utilities Select Sector SPDR (XLU) leading the pack with gains of 1.2%, 0.8%, and 0.8%, respectively.
Geopolitical Impact on Oil Prices
One of the most significant factors influencing market sentiment was the geopolitical situation in the Middle East. Israel's targeted military strikes on Iran, which avoided critical oil and nuclear facilities, led to a substantial drop in oil prices. Brent crude futures plummeted by 6.09% to $71.42 per barrel, while U.S. West Texas Intermediate (WTI) crude fell by 6.13% to $67.38 per barrel. These prices marked the lowest levels since October 1.
The Organization of the Petroleum Exporting Countries (OPEC) and its allies in OPEC+ have decided to maintain their current oil production strategy for now, with plans to increase output starting in December. The next OPEC+ meeting is scheduled for December 1, and these decisions could significantly impact the dynamics of the oil market.
Third-Quarter Earnings Highlights
Several notable companies reported their third-quarter earnings, providing valuable insights into their performance.
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PROCEPT BioRobotics Corporation ($PRCT) reported an adjusted earnings loss of $0.40 per share for the third quarter, better than the Zacks Consensus Estimate of a $0.48 loss. The company generated total revenues of $58.37 million, exceeding the Zacks Consensus Estimate by 9.56%. This positive earnings surprise led to a 32.3% surge in the company's stock price.
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Bank of Hawaii Corporation ($BOH) announced adjusted earnings of $0.93 per share, surpassing the Zacks Consensus Estimate of $0.81 per share. The bank holding company reported total revenues of $162.73 million, beating the Zacks Consensus Estimate by 1.52%. As a result, the stock price of Bank of Hawaii Corporation increased by 9.6%.
Market Sentiment and Volatility
The CBOE Volatility Index (VIX), often referred to as the fear gauge, decreased by 2.6% to 19.80. This decline indicates a reduction in investor anxiety and an increase in market confidence. The S&P 500 recorded 15 new 52-week highs and two new lows, while the Nasdaq Composite noted 101 new highs and 67 new lows. These metrics suggest a generally positive outlook among investors.
Investor Outlook
As investors prepare for significant earnings reports from major technology firms and upcoming economic data, the easing geopolitical tensions in the Middle East have contributed to a more optimistic investor outlook. The market's positive reaction to the diminished geopolitical crisis and the strong earnings reports from key companies set a bullish tone for the upcoming trading sessions.
Sector Performance
The performance of various sectors within the S&P 500 was mixed but predominantly positive. The Financials sector, led by the Financials Select Sector SPDR ($XLF), rose by 1.2%. The Materials sector, represented by the Materials Select Sector SPDR ($XLB), gained 0.8%, and the Utilities sector, tracked by the Utilities Select Sector SPDR ($XLU), also increased by 0.8%. These gains reflect a broad-based market rally driven by improved investor sentiment.
Conclusion
The stock market's positive close on October 28, 2024, was driven by a combination of factors, including the easing of geopolitical tensions, strong earnings reports, and anticipation of upcoming economic data. As we move forward, investors will be closely watching the earnings season and geopolitical developments to gauge the market's direction.
In conclusion, Monday's market performance underscores the resilience and adaptability of the U.S. stock market. With key earnings reports and economic data on the horizon, investors are poised to navigate the complexities of the market with a mix of caution and optimism. The drop in oil prices and the positive earnings surprises from companies like PROCEPT BioRobotics and Bank of Hawaii have set the stage for what could be an interesting and potentially rewarding period for investors.
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