Stock Market Today: Dow, S&P 500 Continue to Hit New Highs

It was another record-setting session for the Dow Jones Industrial Average and S&P 500 Index as investors parsed the latest corporate earnings reports.

On the positive side, delivery firm United Parcel Service (UPS, +7.0%) jumped after reporting higher-than-expected earnings and revenue for its third quarter. Industrial conglomerate General Electric (GE, +2.0%) was another post-earnings winner thanks to its upwardly revised full-year earnings guidance.

And while a solid reading on October consumer confidence kept the major benchmarks in the green – with the Conference Board reporting the first month-over-month increase in its composite index (to 113.8 from September's 109.8) since June – negative reactions to revenue misses from social media giant Facebook (FB, -3.9%) and defense contractor Lockheed Martin (LMT, -11.8%) brought them off their session highs.

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Still, the Dow closed up 0.04% at 35,756 and the S&P 500 gained 0.2% at 4,574 – new record highs – while the Nasdaq Composite added 0.06% to 15,235.

Other news in the stock market today:

• The small-cap Russell 2000 gave back 0.7% to end at 2,296.
• U.S. crude oil futures rose 1.1% to finish at $84.65 per barrel.
• Gold futures slipped 0.7% to settle at $1,793.40 an ounce.
• The CBOE Volatility Index (VIX) spiked 4.9% to 15.98.
• Bitcoin prices fell 1.2% to $61,951.69. (Bitcoin trades 24 hours a day; prices reported here are as of 4 p.m. each trading day.)
• Hasbro (HAS) gained 3.2% after the toymaker reported higher-than-expected third-quarter adjusted earnings of $1.96 per share on inline revenues of $1.97 billion. The company's entertainment division got a lift from its "My Little Pony" and "Come From Away" productions, which helped cushion the blow from shipment delays caused by global supply chain disruptions. CFRA analyst Zachary Warring maintained a Buy rating on HAS. "The company saw 76% sales growth in entertainment as the division benefitted from resumed productions and deliveries and 32% sales growth in digital gaming as they see continued momentum in the space. We believe HAS will outperform as its entertainment and digital segments drive margins and sales higher," he wrote in a note.
• Google parent Alphabet (GOOGL) delivered a wide third-quarter beat on both the top and bottom lines. The company brought in $65.1 billion in revenues to top estimates for $63.3 billion, and earned $27.99 per share to easily exceed expectations for income of $23.48 per share. That’s a particularly strong quarter given that traffic acquisition costs of $11.5 billion were much higher than the $8.2 billion reported in the year-ago quarter. GOOGL shares, however, were down 2% in early after-hours trade.

Is the Market Poised for More Gains?

Seasonality suggests the stock market has plenty of upside left. The S&P 500 tends to mark its fourth-quarter lows in late October before rising into the new year, says Ryan Detrick, chief market strategist for LPL Financial. Furthermore, Q4 is historically the strongest quarter of the year.

And looking beyond seasonality, Detrick points to several signs of improving market internals and fundamentals, including the recent rebound in copper prices, the broader indexes making new highs and declining COVID-19 cases.

A confluence of such signals, notes Detrick, can "clear the way for a potentially bullish environment for equities through year-end." As such, the strategist believes "tactical investors should tilt portfolios in favor of stocks over bonds relative to their respective targets."

For those looking to ride this bullish wave into the new year, consider financials, which are hitting new highs after several months of stagnation. Another way to participate in seasonal tailwinds is with consumer discretionary stocks – which are outperforming the S&P 500 after lagging it for most of the summer – and could continue to do so through the key holiday shopping season. Have a look as we examine 13 of the best opportunities in the consumer discretionary sector.