S&P 500 climbs as Tesla rally pushes stocks higher

The S&P 500 climbed Thursday, as Tesla led a jump in consumer stocks following the electric vehicle maker's better-than-expected quarterly results 

by stronger-than-expected earnings from EV giant Tesla. 

At 1:08 p.m. ET (17:08 GMT), the Dow Jones Industrial Average traded 168 points, 0.4%, lower, while the S&P 500 index rose 0.2%, and NASDAQ Composite climbed or 0.7%. Tesla posts stronger-than-expected Q3

Tesla (NASDAQ:TSLA ) rallied 19% after the electric vehicle maker reported robust third-quarter profits and surprised investors with a prediction of 20-30% growth in sales next year.

The earnings beat was fueled chiefly by improved margins, while the improved outlook for deliveries follows nearly a year of waning growth amid increased competition in major market China and saturating EV markets in the West.

Gross margins excluding credits, a closely watched performance metric, rose to 17.05% from 14.7% in the prior quarter

This all important metric ...  beat "the Street's estimate at 15.1% and now appearing to be on a trajectory back into the 20% level in 2H2025," Wedbush said in a Thursday note.

The stock is the first of the so-called “Magnificent Seven” to report this earnings season, with its positive reading drumming up hopes of a similar trend from Tesla’s peers, which are due to report in the coming weeks. 

Alphabet (NASDAQ:GOOGL ), Microsoft (NASDAQ:MSFT ), Meta Platforms (NASDAQ:META ) and Amazon  (NASDAQ:AMZN ) are set to report earnings next week.  Quarterly earnings pour in

Around 29% of S&P 500 companies have reported results so far this quarter, according to data compiled by LSEG, with 81% beating earnings estimates.

Boeing (NYSE:BA ) stock fell 1.8% after striking machinists rejected a revised contract offer, extending a crippling labor action that is placing heavy pressure on new CEO Kelly Ortberg's plans to overhaul the jet manufacturer's ailing finances.

Southwest Airlines (NYSE:LUV ) stock rose 4.6% after Bloomberg reported that the carrier and Elliott Investment Management are closing in on a settlement that would avoid a proxy fight. The airline also reported a surprise third-quarter profit, benefiting from improved pricing and demand.

United Parcel Service (NYSE:UPS ) stock rose 5% after the shipping company reported third-quarter earnings and revenue that exceeded expectations.

Hasbro (NASDAQ:HAS ) stock fell 5% after the toymaker posted a steeper-than-expected drop in sales as consumers tightened spending on toys, but the company's stringent cost controls boosted margins.

International Business Machines (NYSE:IBM ) stock fell 6% after the technology company reported reduced enterprise spending on non-GenAI projects pressured its consulting segment, clouding software unit strength. Jobless claims fall

Away from the corporate sector, the number of Americans filing new applications for unemployment aid unexpectedly fell last week, dropping 15,000, as the labor market retained a reasonably healthy tone.

The Federal Reserve's "Beige Book" report on Wednesday described employment as having "increased slightly" in early October, and the strong payrolls result at the start of the month helped the market reassess the likely size of future rate cuts by the Federal Reserve.

Investors will also be keeping an eye on the political situation, with a WSJ poll on Wednesday putting former President Donald Trump, the Republican presidential candidate, heading his Democratic rival Kamala Harris 47% to 45%.

This is still within the poll's margin of error, suggesting a tight election ahead.   (Peter Nurse, Ambar Warrick contributed to this article.)

Source: Investing.com