Dow Sets Intraday High Amid Trade and Growth Concerns –

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Here Are 3 Hot Things to Know About Stocks Right Now

  • The Dow Jones Industrial Average  set an intraday high following gains during the previous three sessions. 
  • PepsiCo Inc. (PEP)  fell 1.2% after the beverage and snacks company topped analysts’ third-quarter earnings forecasts but trimmed full-year earnings guidance thanks in part to a stronger U.S. dollar.
  • Stitch Fix Inc. (SFIX) tumbled 32.8% after fiscal fourth-quarter revenue missed analysts’ estimates and its number of active clients came up short.

Wall Street Overview

The Dow Jones Industrial Average set an intraday high on Tuesday, Oct. 2, despite concerns over prospects for global growth that come amid lingering trade tensions between the U.S. and China and as the bullish sentiment from the revamp of NAFTA began to fade.

International Monetary Fund Managing Director Christine Lagarde warned on Monday that the IMF was likely to lower its global growth forecast this month amid the U.S.-China trade war, rising interest rates and a stronger U.S. dollar.

“In July, we projected 3.9% global growth for 2018 and 2019,” Lagarde said. “The outlook has since become less bright, as you will see from our updated forecast next week.”

The new USMCA trade deal, which replaces NAFTA with some specific yet potentially notable changes in the automotive and dairy industries, could also embolden the White House’s stance in its current standoff with Beijing, which currently includes tariffs on $250 billion worth of China-made goods and could add levies on a further $267 billion more before the end of the year.

Meanwhile, Federal Reserve Chairman Jerome Powell said in a speech on Tuesday that inflation was being kept in check even with low unemployment in the U.S.

“Many factors, including better conduct of monetary policy over the past few decades, have greatly reduced … the effects that tight labor markets have on inflation,” Powell said at the National Association for Business Economics in Boston.

The Dow Jones Industrial Average  rose 166 points, or 0.63%, to 26,817. Earlier in the session, the index set an intraday high of 26,820. The S&P 500   rose 0.21%, and the Nasdaq  slipped 0.1%.

Leading the Dow higher were Intel Corp. (INTC) , Caterpillar Inc. (CAT) and Walgreens Boots Alliance Inc. (WBA) .

PepsiCo Inc. (PEP) topped analysts’ third-quarter earnings forecasts but trimmed full-year earnings guidance thanks in part to a stronger U.S. dollar. 

Pepsi said adjusted earnings in the quarter were $1.59 a share, 2 cents ahead of estimates. Revenue of $16.49 billion also beat forecasts. However, Pepsi shaved a few pennies from its full-year earnings forecast, saying it expects $5.65 a share, narrowly shy of the $5.69 consensus. The company raised its growth outlook for organic revenue. Shares fell 1.2%.

General Electric Co. (GE)   rose 2.3% despite Moody’s Investors Service putting GE’s A2 credit rating on review for possible downgrade, just one day after the shares topped the S&P 500 amid renewed optimism for new CEO Larry Culp.

“Among the range of issues that Moody’s will consider is the impact on GE’s earnings and cash flow prospects of the continuing deterioration in its Power business, which is likely to persist for some time,” Moody’s said. “The dimmer prospects for GE Power take on heightened importance given the loss of free cash flow from GE’s planned divestitures, including the highly cash generative GE Transportation and GE Healthcare.”

Tesla Inc. (TSLA) said it produced 80,142 vehicles in the third quarter, a new all-time high and an increase of 50% from the previous record it set in the second quarter. Of that number, 53,239 of those vehicles were Model 3s, up from 28,578 Model 3s made in the previous quarter. The company had forecast that it would produce between 50,000 and 55,000 Model 3 cars.

The company said that it produced 5,300 Model 3 vehicles in the final week of the quarter.

Tesla delivered 83,500 total vehicles in the third quarter, including 55,840 Model 3s, 14,470 Model S and 13,190 Model Xs. Analysts were expecting the company to deliver 82,000 vehicles. Analysts polled by FactSet were expecting the company to deliver 56,000 Model 3s in the quarter.

Tesla fell 1.7% on Tuesday.

Ford Motor Co. (F)  said sales in September fell 11.2%, a declined that was wider than analysts’ estimates. Shares of the automaker fell 0.8%.

Stitch Fix Inc. (SFIX) tumbled 32.8% after fiscal fourth-quarter revenue missed analysts’ estimates and its number of active clients came up short. Active clients rose 25% from a year earlier to 2.7 million by the end of the fiscal fourth quarter but analysts were expecting 2.81 million.

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