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Stock Market News for Oct 18, 2021

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Benchmarks closed in the green on Friday lifted by better-than-expected earnings report from Goldman Sachs and an array of solid economic data.

How Did the Benchmarks Perform?

The Dow Jones Industrial Average (DJI) jumped 382.20 points, or 1.1%, to close at 35,294.76, with The Goldman Sachs Group, Inc. (GS - Free Report) leading the rally with 3.8% gain. Goldman Sachs carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The S&P 500 rose 33.11 points, or 0.8%, to close at 4,471.37 on Friday. Eight of the 11 major sectors of the broader index closed in the green led by 1.8%, 1.5% and nearly 1% gain in consumer discretionary, financials and industrials sectors, respectively. The Nasdaq Composite Index closed at 14,897.34, after adding 73.91 points, or 0.5%, led by 3.3% gain in shares of, Inc. (AMZN - Free Report) .

On Friday, the fear-gauge CBOE Volatility Index (VIX) decreased 3.3%, to close at 16.30. Advancing issues outnumbered declining ones on the NYSE by a 1.12-to-1 ratio. A total of 9.83 billion shares were traded on the last day of the week, lower than the last 20-session average of 10.5 billion.

Solid Quarterly Report from Big Banks

On Friday, big banks continued to report third-quarter earnings, Goldman Sachs Group reported better-than-expected earnings just like peers Bank of America, Morgan Stanley, Citigroup and Wells Fargo that reported on Thursday.

For the quarter, Goldman Sachs reported earnings of $14.93 per share outpacing the Zacks Consensus Estimate of $9.78. The fac banking tors boosting revenues were equity underwriting, wealth management and consumer businesses, however, gains were capped by lower Fixed Income, Currency and Commodities Client Execution revenues. (Read More)

Retail Sales Edge Up in September

On Friday, the government reported that retail sales rose 0.7% in September, surprisingly beating the consensus estimate of 0.1% decline. The measure excluding auto sales rose 0.8%, much better than the forecasted 0.5%. August’s retail sales figure was also upwardly revised to 0.9% and that excluding auto sales was revised to a 2% increase.

In September, spending accelerated as coronavirus cases continued to drop and students and employees returned to school and offices. This helped in boosting sales across sporting goods, music and book stores, leading sales to rise 3.7%, while sales across general merchandise and miscellaneous retailers rose 2% and 1.8%, respectively. The fear of delta variant spread however restricting gains across the restaurants and bars to 0.3%, while overall food and beverage spending increased 0.7%.

Auto sales increased 0.5% despite supply-side constraints caused by a shortage in semiconductors. Spending across fuel stations jumped 1.8% last month.

In a separate report, the University of Michigan reported that it’s reading of consumer sentiment decreased to 71.4 in October from 72.8 in September. Consumers have shown doubts and will continue to dim the pace of spending as inflation keeps rising.

Weekly Roundup

For the week ending Oct 15, the Dow, the S&P 500 and the Nasdaq closed 1.6%, 1.8% and 2.2%, higher, respectively. Benchmarks booked the second straight weekly gain boosted by better-than-expected third-quarter earnings report, especially from big banks and also positive economic data.

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