Stocks Edge Higher, 10-Year Auction on Deck
October 12, 2023: Stocks rose for a fourth day on October 12, 2023, as investors bet on a solid third-quarter earnings season and the end of the Federal Reserve’s historic rate-hiking cycle.
A $35 billion auction of 10-year bonds later that day will provide a key demand benchmark amid historic volatility in the Treasury bond market.
Shares of Novo Nordisk and Eli Lilly jumped after their diabetes treatment, Ozempic, showed promise in treating patients with chronic kidney disease.
ExxonMobil announced a $75 billion deal to acquire Pioneer Natural Resources, the largest US oil and gas producer not already part of one of the world’s oil majors.
Delta Air Lines reported $1.32 per share earnings, beating analyst expectations and sending its shares higher.
What does this mean for investors?
The continued rise in stock prices is a positive sign for investors. Investors are becoming more confident in the economy and the outlook for corporate profits.
Investors will closely watch the upcoming auction of 10-year bonds for signs of demand for US government debt. A strong auction could push Treasury yields lower, which would benefit stocks.
The positive results from the Ozempic trial could lead to a new revenue stream for Novo Nordisk and Eli Lilly. It could also increase demand for Ozempic from patients with chronic kidney disease.
The ExxonMobil-Pioneer Natural Resources deal is a significant consolidation move in the oil and gas industry. It will likely lead to higher oil prices and increased profits for ExxonMobil.
Delta Air Lines’ earnings beat shows that the airline industry is recovering from the COVID-19 pandemic. It is also a good sign for the overall economy, as Delta is a major consumer of goods and services.
Conclusion
The stock market is off to a strong start in October 2023. Investors are optimistic about the economy and the outlook for corporate profits. The upcoming auction of 10-year bonds, the positive results from the Ozempic trial, the ExxonMobil-Pioneer Natural Resources deal, and Delta Air Lines’ earnings beat are all positive signs for investors.
