📈 Stocks Surge as Earnings Beat Expectations

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Hey there, readers! Today, let's dive into the exciting world of stocks and corporate earnings. 🚀

The bond market offered some relief to investors on Tuesday, while corporate earnings put them in a celebratory mood. The yield on the 10-year Treasury remained steady at 4.84%, ending the day where it started. Despite the Federal Reserve officials being in a blackout period, investors are eagerly waiting for next week's policy-setting meeting to gain insights into the future path of interest rates. On the economic front, there were only a few minor reports, but the real action was in the earnings reports.

And boy, oh boy, have the earnings been impressive! According to Refinitiv, 96 out of the 118 S&P 500 companies that have reported their third-quarter results have beaten estimates. Only 21 have fallen short. This suggests that earnings growth, once all companies have reported, will exceed current estimates. What's more, earnings growth is expected to pick up even more in the current quarter, indicating that the profit slump is finally over. 🎉

However, not all companies have fared equally well. Credit-reporting firm TransUnion reported weaker-than-expected third-quarter performance and slashed its annual guidance, citing slowing volumes. As a result, its stock plummeted by 23%. But overall, the market remained bullish, with the Dow Jones Industrial Average rising by 205 points (0.6%), the S&P 500 gaining 0.7%, and the Nasdaq climbing 0.9%. 📈

Now, let's take a quick look at what else is happening in the market:

  • M&A Mega-Transactions Point to Market Recovery: After a slow start to dealmaking, large-scale mergers and acquisitions are making a comeback. Ten deals larger than ten billion dollars were announced in Q2, signaling a positive trend in the market.
  • This $5 Billion Biotech Home Run Took Less Than a Year: Roivant's swift sale of a bowel-disease treatment it acquired from Pfizer just 11 months ago has stunned Wall Street. The biotech company sold the asset to Roche for a whopping $7 billion, highlighting the unpredictable nature of the pharma industry.
  • Is It Time To Worry About Banks' Business Lending? Regional banks are facing the prospect of a slowdown in business lending, which is a core offering for many of these institutions. While risks associated with credit cards and offices have been in the spotlight, the impact on business lending could be significant.

That's all for today's market update! Stay tuned for more exciting news and analysis. 📰

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