US Stocks Remain Steady at Near Records as Oil Drops

U.S. stocks remained steady at near record levels on Tuesday after several big banks delivered stronger profits while the price of crude oil dropped.
The S&P 500 rose slightly, up 0.1 percent in early trading, just one day after hitting a new all-time high for the 46th time this year. Meanwhile, the Dow Jones Industrial Average slipped by 256 points, or 0.6 percent, while the Nasdaq Composite was 0.3 percent higher.
Bank of America and Goldman Sachs both rose by over 1 percent, exceeding Wall Street’s quarterly profit expectations. Charles Schwab surged 8.4 percent, as more customers flocked to open brokerage accounts, boosting the firm’s earnings beyond forecasts.
Drugstore chain Walgreens Boots Alliance also impressed investors, jumping 10.7 percent after delivering higher-than-expected profits despite plans to close 1,200 locations over the next three years in an attempt to revitalize its struggling U.S. business.
Wolfspeed, a chipmaker, saw the most significant gain of the day with shares soaring 35.8 percent. The surge followed the announcement that the Biden administration will provide up to $750 million in funding to support Wolfspeed’s silicon carbide factory in North Carolina, a crucial player in the production of advanced computer chips.
Despite gains in the banking and tech sectors, energy stocks struggled as oil prices plummeted. Brent crude, the global benchmark for oil, dropped over 4 percent, sliding back below $74 per barrel from more than $80 the previous week.
This comes as China’s flagging economy has raised concerns about dampened demand for crude oil, which could lead to excess supply, while fears of an Israeli strike on Iranian oil facilities have lessened, further calming the market.
Iran is a major producer of oil, and the worry beyond a possible strike to supplies was that an expanding war could draw in other big oil exporters.
Exxon Mobil lost 2.8 percent, and other energy companies followed suit as the sector faced the brunt of the oil price dip.
Meanwhile, UnitedHealth Group fell by 9.5 percent despite reporting stronger-than-anticipated earnings. The healthcare giant also reduced the upper range of its profit forecast for the year.
In the bond market, Treasury yields dipped, following a weaker-than-expected manufacturing report from New York state. The 10-year Treasury yield slid to 4.05 percent, down from 4.10 percent on Friday, as manufacturing remained under pressure from the Federal Reserve’s high interest rates.
The Fed, which had been hiking rates to curb inflation, has recently begun cutting rates in an effort to balance economic growth while keeping inflation in check. Recent reports showing the U.S. economy remains stronger than expected have also raised optimism that the Fed can achieve a perfect landing, reducing inflation to 2 percent without triggering a recession.
This article includes reporting from The Associated Press.