SPX: S&P 500, Dow Hit New Records as Strong Bank Earnings Signal Soft Landing

JPMorgan and Wells Fargo rallied Friday after both banks posted third-quarter profits that beat expectations. Soft landing confirmed?

• The S&P 500 and the Dow Jones Industrial Average once again defied gravity and pushed to fresh record closing highs on Friday. The mood this time was brightened by the first batch of bank earnings for the third quarter. Two major players posted solid figures, demonstrating the US economy is in good shape. JPMorgan JPM and Wells Fargo WFC kicked it off with quarterly profits that topped Wall Street expectations.
• The broad-based S&P 500 jumped a good 0.6% on Friday to an all-time high of 5,815.03. The 30-stock Dow Jones added a solid 1%, or 409 points, to a new closing record of 42,863.86. The Nasdaq Composite added a more modest 0.3% with well-known tech names staying well-bid as they’re getting ready to be the highlight of the earnings season. Streaming giant Netflix NFLX reports Thursday.
• Going back to macro, with the new record, markets had a slight delay in cheering consumer inflation data, which showed last week that price pressures continued to moderate — September’s CPI came in at 2.4%, lower than the 2.5% in August but above expectations for 2.3%. Still, the number, paired with the big banks’ earnings, showed that a soft landing might be playing out right now — inflation is coming down and banks release robust results while interest rates are moving lower.