S&P 500; US Indexes Fundamental Daily Forecast – Earnings are Taking Centerstage

The major U.S. stock indexes are trading sharply higher at the mid-session with investors gaining confidence as they continue to shrug off recent geopolitical events, choosing instead to react positively to strong results from some of the biggest U.S. companies.

In the cash market at 1530 GMT, the benchmark S&P 500 Index is trading 2705.76, up 27.92 or +1.04%. The blue chip Dow Jones Industrial Average is at 24831.74, up 258.70 or +1.05% and the tech-driven NASDAQ Composite is trading 7264.18, up 107.80 or +1.51%.

The Dow is being driven higher by shares of UnitedHealth and the consumer and technology sectors. Shares of Goldman Sachs and Johnson & Johnson are also contributing to the rally.

An 8.1 percent jump in shares of Netflix is behind the sharp rise in the NASDAQ Composite.

UnitedHealth shares rose 4 percent after it reported better-than-expected earnings and raised its outlook for 2018. Goldman Sachs reported better-than-expected earnings and revenue for the first quarter, boosted by a 38 percent jump in equities trading revenue. Finally, Johnson & Johnson posted a profit that surpassed estimates, boosted by a strong performance by its pharmaceuticals segment.

Netflix helped start the rally after the close on Monday after reporting in-line quarterly earnings and higher-than-expected subscriber growth.

With Q1 earnings season starting solidly, the markets are likely to continue to react to this news rather than the geopolitical events and economic data. According FactSet, Wall Street analysts are expecting a 17.3 percent increase in first quarter earnings.

Earlier in the session, investors showed almost no response to a government report that showed housing starts rebounded in March, coming in at 1.319 million versus the estimate of 1.262 million.