S&P 500 hits record high on tech strength, earnings cheer

© Reuters. FILE PHOTO: Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., October 21, 2021. REUTERS/Brendan McDermid

By Devik Jain and Shashank Nayar

(Reuters) - Gains in Tesla (NASDAQ:TSLA), Nvidia (NASDAQ:NVDA) and other heavyweight technology names helped the benchmark S&P 500 index scale a record high on Tuesday, while upbeat results from UPS and GE added to optimism around the third-quarter earnings season.

Tesla Inc rose 1%, extending a record run that helped the electric-car maker surpass $1 trillion in market value on Monday after landing its biggest-ever order from rental car company Hertz.

Nvidia Corp was up 6.8% and hit an all-time high, while gains in mega-cap growth names such as Amazon.com (NASDAQ:AMZN), Apple Inc (NASDAQ:AAPL), Google-owner Alphabet (NASDAQ:GOOGL) Inc and Microsoft Corp (NASDAQ:MSFT) gave a boost to the tech-heavy Nasdaq.

Ten of the 11 major S&P sectors advanced, with consumer discretionary, information technology and financials hitting life-time highs.

United Parcel Service Inc (NYSE:UPS) surged 7.6% to top the S&P 500 index after the delivery firm reported better-than-expected quarterly earnings and revenue, bolstered by strong e-commerce demand.

General Electric (NYSE:GE) Co rose 2.6% after the industrial conglomerate raised its full-year earnings forecast.

Shares of Hasbro Inc (NASDAQ:HAS) climbed 3.7% after the toy maker posted an upbeat third-quarter profit even as it warned of a hit to holiday sales from supply chain issues.

"Investors are prepared for the worst and are looking at the near-term positives against what lies ahead and that is helping gains at an index level," said Arthur Hogan, chief market strategist at National Securities in New York.

"The key component of the weak outlooks are led by supply and not because of lack of demand for companies ... there is confidence that corporate America will be able to navigate through a lot of the supply and inflation headwinds."

Earnings at S&P 500 companies are expected to grow 35.6% year-on-year for the third quarter, with market participants assessing how companies are navigating supply-chain bottlenecks, labor shortages and inflationary pressures.

Some stellar quarterly reports have helped drive the Dow and the S&P 500 to record highs, lifting investor sentiment in October after concerns around inflation, the Fed's tapering and property group China Evergrande's crisis rattled markets last month. The Nasdaq is trading about 0.5% below its Sept. 7 record high.

At 11:46 a.m. ET, the Dow Jones Industrial Average was up 125.39 points, or 0.35%, at 35,866.54 to hit a record high.

The S&P 500 was up 24.64 points, or 0.54%, at 4,591.12, and the Nasdaq Composite was up 94.73 points, or 0.62%, at 15,321.44.

Facebook Inc (NASDAQ:FB) slipped 3.2% as the social media giant's third-quarter revenue faced the brunt of Apple's privacy rules, while advertisers were also affected by global supply-chain disruptions and labor shortages.

Twitter Inc (NYSE:TWTR), which also generates revenue by selling digital ads, edged higher ahead of its results on Tuesday.

Eyes are also on quarterly updates from Alphabet Inc and Microsoft after market close, with focus on how Google's ad revenue fares.

Meanwhile, data showed U.S. consumer confidence unexpectedly rebounded in October as concerns about high inflation were offset by improving labor market prospects.

Advancing issues outnumbered decliners for a 1.44-to-1 ratio on the NYSE and a 1.24-to-1 ratio on the Nasdaq.

The S&P index recorded 60 new 52-week highs and no new low, while the Nasdaq recorded 119 new highs and 44 new lows.