U.S. stocks closed mixed Tuesday as traders eye the growing pile of corporate-earnings reports.

How stocks traded

  • The Dow Jones Industrial Average
    DJIA
    went down 96.36 points or 0.3% to end at 37,905.45, according to Dow Jones Market Data

  • The S&P 500
    SPX
    rose 14.17 points or 0.3% to finish at 4,864.60, a new record close. It is the index’s third record close in 2024.

  • The Nasdaq Composite
    COMP
    rose 65.66 points or 0.4% to close at 15,425.94, its highest value since Jan. 4, 2022.

On Monday, the Dow finished above the 38,000-point milestone for the first time in its history, while the S&P 500 scored its second record-high close of 2024. The Nasdaq Composite rose 0.3%.

What drove markets

The Dow on Tuesday retreated from its record high as investors keep their eyes fixed on fourth-quarter earnings.

“The less-than-stellar earnings season so far is weighing down the rally,” according to Louis Navellier, chair and founder of Navellier & Associates. “We’ve only just started the earning season, but so far they have not exceeded expectations,” Navellier wrote in a Tuesday note.

The Dow’s pullback could be linked to 3M’s
MMM,
-11.03%
stock selloff after a 2024 profit warning, according to Navellier. Johnson & Johnson
JNJ,
-1.64%
shares also fell, even though the company posted stronger-than-expected earnings for the fourth quarter.

After closing at all-time highs, “it’s not uncommon for markets to relax for a second after making big moves like that,” Alex Coffey, TD Ameritrade senior trading strategist, said in a phone interview. 

Coffey has his eyes on Thursday’s macroeconomic numbers on durable-goods orders, GDP growth and jobless-benefit claims data. On Friday, the numbers to watch include the Federal Reserve’s preferred inflation gauge, the personal-consumption expenditures price index, along with numbers on personal income and spending.

If the data remain resilient, “it really complicates that timetable” investors may have for when interest rate cuts will arrive, Coffey said.

Companies that released results before the opening bell Tuesday included Verizon
VZ,
+6.70%,
3M
MMM,
-11.03%,
General Electric
GE,
-0.98%,
Procter & Gamble
PG,
+4.14%
and RTX
RTX,
+5.33%.
After market close, there’s Netflix
NFLX,
+1.33%,
Texas Instruments
TXN,
-0.28%
and Baker Hughes
BKR,
+1.78%.

Earnings season will go into high gear next week, when about 23% of the S&P 500 will present their numbers.

Read also: Here’s what big consumer-sentiment gains mean for the stock market — and this one is unusual

Investors have become more optimistic about the U.S. economy’s health and are hoping upcoming earnings reports will indicate an artificial-intelligence boom for technology companies, according to Stephen Innes, managing partner at SPI Asset Management.

“Tech earnings and corporate guidance are crucial factors for continuing to drive the mega tech charge,” Innes said.

Companies in focus

Jamie Chisholm contributed.

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