Most U.S. stocks rose Wednesday following an encouraging start to what’s expected to be a thunderous earnings reporting season, but major indexes still ended mixed as drops in several tech heavyweights including Apple and Facebook weighed them down.
The S&P 500 fell 0.4%, easing below the record high it set a day earlier. The tech-heavy Nasdaq lost 1% but the Russell 2000, which tracks smaller companies, climbed 0.8%. Shares of Coinbase Global surged in their market debut as more mainstream investors embrace cryptocurrencies. Crude oil prices rose sharply on expectations that a resurgent economy will consume more energy.
The S&P 500 was held back by drops for several heavyweight stocks, including Apple and Amazon, but the majority of stocks within the index were rising. Smaller companies were also rallying amid growing optimism as COVID-19 vaccines roll out and businesses reopen. The Russell 2000 index of small-cap stocks was up 1.1%.
Much of the market’s focus in coming weeks will be on earnings season, as companies line up to report how much profit they made during the first three months of 2021. Expectations are very high, and this may be the best quarter of earnings growth for S&P 500 companies in more than a decade.
Big banks are traditionally among the first companies to report, and Goldman Sachs, JPMorgan Chase and Wells Fargo all unveiled earnings for the first quarter that blew past analysts’ forecasts. Much of the surge was due to expectations for a rapidly improving economy, which allowed banks to free up reserves held in case loans went bad, as well as strong trading revenue.