S&P 500 Closes at Record High as Earnings Roll In

The S&P 500 notched a record closing high and its fifth straight day of gains Tuesday with a mixed reception to the latest earnings reports and a steep selloff in health insurers countering optimism ahead of megacap reports.

UnitedHealth led losses in healthcare stocks and in the Dow Jones Industrial Average with massive tumble after the Trump administration proposed an increase in Medicare insurer payment rates.

The plan was another woe added to the insurer's disappointing revenue forecast for 2026. Also sliding were insurance peers Humana and CVS.

In more encouraging earnings news, bellwether United Parcel Service rallied after it projected higher revenue for 2026, also pulling up shares in rival FedEx. General Motors shares also rallied after it reported higher fourth-quarter core profit.

And with megacap earnings reports due to kick off this week, technology stocks extended Monday's gains, with Microsoft, Nvidia, Apple, Amazon, and Broadcom providing some of the market's biggest boosts.

S&P 500 NEARS 7,000

With this, the Nasdaq touched its highest level since late October while the S&P 500 touched an intraday record high and neared the 7,000 milestone.

"There's a little bit of a bifurcated market today with the Dow down because of the announcements around Medicare premiums," Phil Blancato, chief market strategist at Osaic Wealth in New York. "When you look at everything else, the market seems to be hanging in there waiting for a big week of earnings."

Also on Tuesday, U.S. consumer confidence unexpectedly deteriorated in January, slumping to its lowest level since 2014, but Blancato noted that surprisingly, the "pretty terrible number" didn't have much of an impact on the stock market.

According to preliminary data, the S&P 500 gained 28.35 points, or 0.41%, to end at 6,978.58 points, while the Nasdaq Composite gained 215.74 points, or 0.91%, to 23,817.09. The Dow Jones Industrial Average fell 409.98 points, or 0.83%, to 49,000.82.

The broader technology sector lead sector gains while Corning led technology gains with a massive rally. The Gorilla Glass maker signed a deal with Meta worth up to 6 billion for fiber-optic cables in AI data centers.

All eyes will be on Meta, Microsoft and Tesla when they report earnings on Wednesday, kicking off results from the so-called "Magnificent Seven," which will test the AI trade that has underpinned Wall Street's rally for much of the past year.

In total, 102 S&P 500 companies are set to post earnings results this week. Of the 64 that had reported as of Friday, 79.7% have topped analyst expectations, as per data compiled by LSEG.

Elsewhere in earnings, trading in Boeing was choppy after it swung to a fourth-quarter profit due to a unit sale but reported bigger-than-expected losses in its two biggest divisions.

And in airlines, American Airlines sold off sharply with the weekend's winter storm expected to weigh on its first-quarter results while its 2026 profit forecast topped estimates. JetBlue shares tumbled on a wider-than-expected quarterly loss as it cited bad weather and the government shutdown during the quarter.

FED WATCH

As if that wasn't enough, investors were also waiting to hear from the U.S. Federal Reserve, which begins its two-day policy meeting on Tuesday, with investors broadly expecting the central bank to leave interest rates unchanged.

Attention will be on policymakers' guidance, with traders alert to any signals around the Fed's leadership.

"We're looking at who the dissenters might be from a voting perspective which will give insights to see how much consensus there is among members around the state of the economy," said Charlie Ripley, senior investment strategist at Allianz Investment Management.