Dow one-month high led by 3M as earnings beat AI worries
The Dow gained more than 1% on Tuesday as strong reports from 3M, Equifax and Hasbro outweighed doubts about AI spending, while the Nasdaq ended flat.
Wall Street's blue chips reached a Dow one-month high on Tuesday, Oct. 20, as company earnings did more to move stocks than fears about the AI boom. The Dow Jones Industrial Average rose 1.02%, or nearly 530 points, while the S&P 500 added 0.29% and the Nasdaq Composite slipped 0.02%.
What happened
3M did most of the lifting. The maker of Scotch tape and Post-it notes jumped 5.78% to $171.37 after raising its full-year adjusted profit forecast to $9.10 to $9.15 a share, from $8.80 to $8.95. Its third-quarter adjusted EPS was $2.50, up from $2.23, on adjusted revenue of $6.6 billion, a 4.2% increase.
Amgen added 3.29% and Merck 3.25% among Dow members, while Apple, Walmart and Boeing were the main laggards. In the broader market, Equifax surged 11.33% and Hasbro climbed 11.20% to a five-year high, with Moderna up 6.74%. General Motors fell 6.84% after its guidance disappointed.
3M's lift came from industrial and electronics demand. CNBC reported that growth in data center and semiconductor markets supported its Transportation and Electronics unit, offsetting soft auto and consumer electronics customers. The company launched 87 new products in the quarter and expects more than 350 by year-end under chief executive William Brown.
Breadth was healthy. Advancers beat decliners by 1,844 to 854 on the New York Stock Exchange, and the Cboe Volatility Index fell 6.13% to 17.31, Investing.com data showed. Healthcare, financials and utilities led, while technology and materials lagged.
Why it matters
The split between the Dow and the Nasdaq shows where the doubts are. Investors are still questioning debt-funded AI infrastructure after a rough stretch for chipmakers that only paused with the Nasdaq chip rebound on Monday. Older industrial and consumer names with steady earnings are getting more attention.
Inside tech, the picture was mixed rather than weak. Data storage company Seagate Technology added 2%, and CoreWeave rose more than 1%, CNBC said. On the Nasdaq exchange, 2,227 stocks rose and 1,129 fell, so the index's flat finish reflected a few heavyweights, including Apple, rather than broad selling. Gold for December delivery eased 0.06% to $4,140.12 an ounce.
Goldman Sachs Research's Christian Mueller-Glissmann wrote that AI concerns, Middle East tensions and the midterm elections could bring near-term swings, but that "earnings support with lighter positioning and lower valuations should help equities into year-end." A Dow one-month high fits that view, though bond yields near multi-decade peaks, which we tracked in our Treasury yields report, remain a brake.
What's next
Futures pointed higher early Wednesday, with S&P 500 contracts up 0.29% and Nasdaq-100 futures up 0.7%, while Dow futures were flat, CNBC reported. In Asia, South Korea's Kospi rebounded 2.7%. Closing levels and sector moves are in Investing.com's market wrap.
Currency and oil markets were calm. The dollar slipped 0.19% against the yen to 158.18, and December Brent crude was quoted at $108.92 a barrel after the stock market close.
Meta reports after Wednesday's close, with Tesla, IBM and Southwest Airlines also due. If tech earnings hold up, the rally could broaden beyond industrials; if not, the Dow one-month high may mark another narrow, earnings-driven bounce.
This article is for information only and is not investment advice.