Tesla lifts Nasdaq to record territory; focus turns to Fed's policy meet

Traders work on the floor of the NYSE in New York
Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., October 27, 2021. REUTERS/Brendan McDermid
  • Tesla hits record high
  • All eyes on Fed's policy meet this week
  • Harley-Davidson rises as EU-U.S. end tariff dispute
  • Indexes: Dow up 0.13%, S&P flat, Nasdaq adds 0.40%

Nov 1 (Reuters) - The Nasdaq index hovered at a record high on Monday boosted by gains in Tesla and Meta Platforms, although investors refrained from making big bets ahead of the Federal Reserve's potential move to start paring pandemic-era support for the world's largest economy.

At 12:01 p.m. ET, the Dow Jones Industrial Average (.DJI) was up 46.29 points, or 0.13%, at 35,865.85, the S&P 500 (.SPX) was up 1.95 points, or 0.04%, at 4,607.33, and the Nasdaq Composite (.IXIC) was up 61.69 points, or 0.40%, at 15,560.08.

The blue-chip Dow (.DJI) and the benchmark S&P 500 index (.SPX) scaled intraday record peaks earlier in the session, with the Dow hitting 36,000 points for the first time.

Tesla Inc (TSLA.O) rose 4.6% to a record high after it notched a trillion dollars in market capitalization last week, while Meta Platforms (FB.O), formerly Facebook Inc, added 2.6% to provide the biggest boost to the S&P 500 and the Nasdaq (.IXIC).

"We had a little bit of chasing this morning and now that's coming off. This market keeps getting driven by the likes of Tesla really," said Dennis Dick, a trader at Bright Trading LLC.

The Institute for Supply Management (ISM) said U.S. manufacturing activity slowed in October as a measure of new orders dropped to a 16-month low and factories continued to experience delays with deliveries of raw materials. read more

The report came ahead of the Fed's policy meeting on Nov. 2-3, when the central bank is expected to announce the tapering of its $120 billion monthly bond buying program amid rising price pressures. read more

"There was initial optimism this morning on the earnings doing better than expected, but now we've got to contend with the Fed on Wednesday and the jobs report on Friday, which are likely going to be the two key catalysts this week," said Thomas Hayes, managing member at Great Hill Capital LLC in New York.

"We're going to see this (market) pattern going into Wednesday, until we get more clarity on when Chair Powell wants to make the announcement on tapering."

A stellar earnings season has drive Wall Street to record highs, with investors cautioning any hawkish tilt in the Fed's message related to rate-hike and inflation could catch equities by surprise. read more

The market has also started pricing in rate hikes next year. Goldman Sachs has brought forward its forecast by a year to July 2022 for the first post-pandemic U.S. interest rate hike, as the investment bank expects inflation to remain elevated. read more

Among stocks, mega-cap technology names Google-owner Alphabet Inc (GOOGL.O), Microsoft Corp (MSFT.O), Amazon.com (AMZN.O) and Apple Inc (AAPL.O) slipped between 0.5% and 1.7% to weigh the most on the S&P 500 and the Nasdaq.

Harley-Davidson Inc (HOG.N) jumped 6.8% after the European Union removed retaliatory tariffs on U.S. products including whiskey, power boats and company's motorcycles. read more

Newell Brands (NWL.O) gained 2.1% after J.P. Morgan upgraded the Sharpie pen maker's stock to "overweight" from "neutral".

Advancing issues outnumbered decliners by a 2.52-to-1 ratio on the NYSE and by a 2.92-to-1 ratio on the Nasdaq.

The S&P index recorded 43 new 52-week highs and two new lows, while the Nasdaq recorded 174 new highs and 35 new lows.

(This story has been refiled to add dropped words 'pandemic-era' in paragraph 1)

Reporting by Devik Jain and Bansari Mayur Kamdar in Bengaluru; Editing by Maju Samuel

Our Standards: The Thomson Reuters Trust Principles.

Thomson Reuters

Bansari reports on the global financial markets and writes Reuters' daily flagship market reports on equities, bonds and currencies. An economist by training and winner of the Arthur MacEwan Award for Excellence in Political Economy, she has written for renowned global papers and magazines including The Diplomat, Boston Globe, Conversation, Huffington Post and more.