Wall Street extends rally on strong earnings

07/21/2021 | 05:49pm

Renewed economic optimism and strong earnings from the likes of Verizon and Coca-Cola injected some fizz in the markets Wednesday as the S&P 500 wiped out all of the losses from Monday's steep sell-off.

Investors are closely tracking earnings results to justify the sky-high valuations many stocks sport.

Sanders Morris Harris CEO George Ball says the markets are still in an uptrend.

"Clearly Tuesday was a counterbalancing of a unnecessarily panic stricken Monday. Today is, 'Gee, earnings are really pretty good. Companies are doing well, the economy is getting better, the future looks comparatively bright and lucky.'"

The Dow and S&P 500 added eight-tenth of a percent, and the Nasdaq rose nine-tenth percent.

Chipotle shares sizzled, jumping over 11% to a record high. Brokerage analysts hiked their price targets after the upscale burrito chain's soaring profit and comparable sales crushed estimates. Chipotle was the top gainer on the S&P 500.

The broad index's second biggest decliner: Netflix. A weak projection for subscriber growth drove its shares down more than 3%.

A strong rebound in domestic travel helped United Airlines' quarterly revenue quadruple from a year ago. Its shares shot up 4%. That also lifted shares of its rivals American and Southwest ahead of their earnings reports on Thursday.

© Reuters 2021
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