Stocks closed higher Tuesday as investors parsed the latest round of earnings and economic data.
One of the day's most notable earnings reports came from Exxon Mobil (XOM), with the energy giant reporting record profits for all of 2022. And on the economic front, a welcome reading on inflation hit the newswires as the Federal Reserve kicked off its first policy meeting of 2023.
Taking a closer look at XOM's earnings, the oil major said it brought in $12.9 billion in profit in the fourth quarter, bringing its full-year earnings to $55.7 billion. On a per-share basis, Q4 earnings of $3.09 fell short of the consensus estimate. Still, the energy stock rose 2.2% on the day.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Another big earnings mover on Tuesday was General Motors (GM), which jumped 8.3% after the carmaker said fourth-quarter earnings increased 57% year-over-year to $2.12 per share. Revenue was up 28.4% to $43.1 billion – easily beating analysts' expectations.
As for that economic data, the Labor Department this morning said its employment cost index (ECI), which measures labor costs, rose 1.0% in the fourth quarter. This was slower than the 1.2% rise seen in the third quarter and below what economists were expecting. "The move in the right direction will be welcomed by the Fed but it still remains elevated, and this won't do anything to change the Fed calculus in the near-term," says Michael Reinking, senior market strategist at the New York Stock Exchange. And that calculus, as the market is expecting, will be the Fed's announcement tomorrow afternoon of a 25 basis point (0.25%) interest rate hike.
At the close, the Dow Jones Industrial Average was up 1.1% at 34,086, the S&P 500 was 1.5% higher at 4,076, and the Nasdaq Composite had added 1.7% to 11,584.
The Closed-End Funds to Buy
The stock market ended January with impressive gains. The Dow rose 2.8%, the S&P 500 rallied 6.2%, and the Nasdaq surged 10.7%. "What had been expected as dip and rip this year may be playing out as rip and dip as the markets continue to advance due to evidence of declining inflation," says Phillip Toews, CEO of Toews Asset Management. However, with the market pricing in potential rate cuts later this year, "investors are assuming a best-case scenario, so risks are to the downside." In other words, the volatility we've seen in the stock market over the last 12 months could be far from over.
Investors have many ways to play defense against the ups and downs of this market, including embracing income-paying investments. The Dividend Aristocrats – widely considered Wall Street's best dividend stocks due to their decades of consistent payout growth – are a good place to find dependable income payers. Meanwhile, real estate investment trusts (REITs) and healthcare stocks are loaded with names sporting generous yields. As for investors looking to take a less well-worn path, they might want to check out the best closed-end funds (CEFs) too. These high-yield funds can significantly boost your income and allow you to buy the underlying stocks and bonds at a discount.
-
Ask the Editor — Tax Questions on the New Senior DeductionAsk the Editor In this week's Ask the Editor Q&A, we answer tax questions from readers on the new $6,000 deduction for taxpayers 65 and older.
-
These Summer 2025 Back-to-School Tax-Free Weekends Start NowSales Tax Over a dozen states offer back-to-school shoppers a sales tax holiday this summer.
-
Stock Market Today: S&P 500, Nasdaq Hit New Highs on Retail Sales RevivalStrong consumer spending and solid earnings for AI chipmaker Taiwan Semiconductor Manufacturing boosted the broad market.
-
If You'd Put $1,000 Into Berkshire Hathaway Stock 20 Years Ago, Here's What You'd Have TodayBerkshire Hathaway is a long-time market beater, but the easy money in BRK.B has already been made.
-
Stock Market Today: Powell Rumors Spark Volatile Day for StocksStocks sold off sharply intraday after multiple reports suggested President Trump is considering firing Fed Chair Jerome Powell.
-
Stock Market Today: Nasdaq Hits a New High as Nvidia SoarsA big day for Nvidia boosted the Nasdaq, but bank stocks created headwinds for the S&P 500.
-
Stock Market Today: Markets Chop Up More Trump ThreatsStocks are grinding to new highs on light summer volume, and bitcoin is only getting bigger.
-
If You'd Put $1,000 Into Procter & Gamble Stock 20 Years Ago, Here's What You'd Have TodayProcter & Gamble stock is a dependable dividend grower, but a disappointing long-term holding.
-
Stock Market Today: Stocks Slip Ahead of Big Earnings, Inflation WeekPerhaps uncertainty about tariffs, inflation, interest rates and economic growth can only be answered with earnings.
-
Stock Market Today: Solid Signals Lift Stocks Despite Tariff NoiseMarkets are whistling over the White House in an ongoing display of corporate America's enduring ability to survive and advance.
