Stocks Settle Higher as Drug Makers and Chip Stocks Rally

Economic Indicators - The US July S&P composite-20 home price index showed a year-over-year increase of +1.82%, surpassing expectations of +1.55%, but marking the slowest pace of increase in two years [1] - The August JOLTS job openings rose by +19,000 to 7.227 million, indicating a stronger labor market than the expected 7.200 million [6] - The September MNI Chicago PMI unexpectedly declined by -0.9 to 40.6, weaker than the anticipated increase to 43.3 [5][6] - The Conference Board's US September consumer confidence index fell by -3.6 to a 5-month low of 94.2, below expectations of 96.0 [6] Stock Market Performance - Stock indexes initially moved lower due to concerns over a potential US government shutdown but later recovered, with the S&P 500 Index closing up +0.41%, the Dow Jones up +0.18%, and the Nasdaq 100 up +0.28% [5][4] - Pharmaceutical stocks rallied, particularly Pfizer, which saw a +6% increase after agreeing to reduce some drug prices by up to 85% [4][15] - Chipmakers also supported the broader market, with notable gains from companies like Nvidia and Micron Technology, both closing up more than +2% [16] Corporate Developments - President Trump announced new tariffs of 10% on softwood timber and lumber imports and 25% on kitchen cabinets and related products, effective October 14 [6] - Rising corporate earnings expectations are seen as a bullish backdrop for stocks, with over 22% of S&P 500 companies providing guidance for Q3 earnings that are expected to exceed analysts' expectations [8] - Semtech closed up more than +15% after an upgrade from Oppenheimer Securities, while Freeport McMoRan rose more than +5% following an upgrade from Bank of America Global Research [19] Sector Movements - Energy producers faced declines as WTI crude oil prices fell by more than -1% to a 1-week low, impacting companies like Baker Hughes and Occidental Petroleum [17] - The pharmaceutical sector's rally was driven by Pfizer's price cuts, which may influence other major drugmakers to follow suit [4][15] - The technology sector, particularly chipmakers, showed strength, contributing positively to market performance [16]