goldman sachs
A financial professional works in the Goldman Sachs booth on the floor of the New York Stock Exchange. Goldman reported disappointing operating results for Q1 2019. Chris Hondros/Getty Images

Traders on Tuesday turned their attention to third-quarter earnings and hopes for an interest rate cut by the Federal Reserve at the end of the month.

The Dow Jones Industrial Average jumped 253 higher at 27,040, while the Nasdaq added 98 points to 8,147 and S&P 500 gained 33 points to 2,999.

Investors pushed aside worries about U.S.-China trade negotiations and political turmoil in Washington to take their cues from corporate America as earnings season kicked into gear.

St. Louis Fed President James Bullard, speaking in London, raised hopes for an interest rate cut at the end of the month by acknowledging the U.S. economy is slowing. The U.S. Federal Reserves Open Markets Committee lowered interest rates 25 basis points at each of its last two meetings in July and September, bringing the federal funds rate to 1.75% to 2%.

“The FOMC may choose to provide additional accommodation going forward, but decisions will be made on a meeting-by-meeting basis,” he said at the 2019 Monetary and Financial Policy Conference.

Bullard blamed trade tensions, slowing growth globally, contraction in manufacturing, slowing U.S. business investment and an inverted yield curve, “which seems to suggest U.S. monetary policy mayt be too restrictive for the current environment.”

Bullard noted uncertainty over trade policy creates “a disincentive for global investment. … Slower global growth may feed back into slower growth in the U.S.”

On the earnings front, JPMorgan Chase (JPM) reported an 8% increase in third-quarter earnings, topping analyst expectations. The bank reported a profit of $9.08 billion or $2.68 a share, on revenue of $29.34 billion. Revenue from interest income rose 2% to $14.23 billion.

Goldman Sachs (GS) reported a 26% drop in earnings compared with a year ago, roughly in line with expectations. The bank is investing in new initiatives, including consumer banking and ultrafast trading. Goldman reported $1.88 billion in net earnings, or $4.79 a share, on $8.32 billion in revenue.

Johnson & Johnson (JNJ) raised its financial forecasts after reporting earnings of $4.83 billion, or $1.81 a share, compared with $3.93 billion, or $1.44 a share, in the year ago quarter. Worldwide sales hit $20.73 billion, up from $20.35 billion a year ago.

UnitedHealth Group (UNH) reported $5 billion in earnings for the quarter, or $3.88 a share, up from $4.6 billion, or $3.41 a share, a year ago, on revenue of $60.4 billion.

On global markets, stocks were mixed. Hong Kong’s Hang Seng closed off 0.07% while Japan’s Nikkei 225 added 1.87% and the China Shanghai Composit fell 0.56%. Australia’s S&P/ASX gained 0.14%.

The London FTSE 100 was flat, closing off 0.03% while the German DAX added 1.15% and the French CAC 40 was up 1.04%. The Stoxx Europe 600 gained 1.11%.

On currency markets, the British pound gained 1.28 cents to $1.2734 while the euro added 0.11 cent to $1.038. The dollar index was off 0.14%.

Oil futures were lower. Crude oil lost 12 cents to $53.47 a barrel while Brent crude was off 3 cents to to $59.38. Gold and silver also were lower.

RELATED STORIES