Wall St rises as corporate earnings roll in: S&P 500 inches closer to record levels

The S&P ‍500 and Nasdaq is advancing as investors parse through a slate of bellwether earnings, while health insurers drop after a Medicare Advantage payment proposal from the Trump administration disappointed investors.

The S&P 500 inched closer to record levels on Tuesday and is hovering about 35 points shy of the 7000 milestone - a mark that analysts have pegged as a potential pocket ⁠of technical resistance.

The Dow fell, pressured by a 19 per cent drop in UnitedHealth after the Trump administration floated only a modest increase in Medicare insurer payment rates.

The proposal clouded over the insurer’s forecast for 2026 adjusted profit, which was above analysts’ expectations. Peers Humana and CVS fell 19 per cent and 9.2 per cent, respectively.

The S&P 500 health index dropped the most, down one per cent.

Earnings took centre stage. Boeing swung to a fourth-quarter profit, but its shares were down 1.8 per cent, while General Motors advanced 5.4 per cent after reporting higher fourth-quarter core profit.

United ‌Parcel Service projected higher revenue for 2026, and rose 1.6 per cent. Peer FedEx added one per cent.

In airlines, American Airlines fell 3.3 per cent despite issuing a 2026 profit forecast that ‍topped estimates. JetBlue fell 6.5 per cent on a wider-than-expected quarterly loss.

Airlines are contending with mass cancellations triggered by severe winter weather across the US East Coast.

In early trading on Tuesday, the Dow Jones Industrial Average fell 0.68 per cent, to 49,076.67, the S&P 500 rose 0.20 per cent, to 6,964.37, and the Nasdaq Composite rose 0.52 per cent, to 23,723.11.

In total, 102 S&P 500 companies are set to post earnings results this week. Of the 64 that had reported as of Friday, 79.7 per cent have topped analyst expectations, as per data compiled by LSEG.

“Our view this year is the impetus for markets to continue to rise is going ‌to be an earnings story rather than a multiples story,” said Charlie Ripley, senior investment strategist at Allianz investment management.

“There’s an expectation that those earnings will be fairly robust and you’re seeing that reflected in stocks moving higher.”

Meta, Microsoft, and Tesla report earnings on Wednesday, kicking off results from the so-called “Magnificent Seven”, which will test the AI trade that ‍has underpinned Wall Street’s rally for much of the past year.

Signs of crowding in the AI trade have recently spurred a rotation into small-caps and other undervalued parts of the market.

The Russel 2000 index, has risen over seven per cent while the S&P 600 small-cap index has advanced 6.5 per cent this month, compared with the benchmark S&P 500’s 1.5 per cent gain.

The Federal Reserve begins its two-day policy meeting on Tuesday, with investors broadly expecting the central bank to leave interest rates unchanged.

Attention will be on policymakers’ guidance, with traders alert to any signals around the Fed’s leadership outlook. Questions over the Fed’s independence resurfaced earlier this month after the Justice Department opened an inquiry involving Powell.

Consumer confidence figures for January are due at 10 am ET, and expected to rise to 90.9 points from 89.1 in December.

The risk of a partial US Government shutdown also loomed ahead of the January 30 funding deadline, as a second fatal shooting by federal agents in Minneapolis sharpened scrutiny of Mr Trump’s immigration crackdown.

Advancing issues outnumbered decliners by a 1.13-to-1 ratio on the NYSE and by a 1.26-to-1 ratio on the Nasdaq.

The S&P 500 posted 9 new 52-week highs and 4 new ‍lows while the Nasdaq Composite recorded 40 new highs and 40 new lows.