The US stock market hit an all-time high yesterday as Wall Street put the government shutdown and debt ceiling crisis behind it and focused on corporate earnings.
The Standard & Poor's 500 index rose 11.61 points, or 0.7%, to close at 1,733.15 - a record close. Nine of the 10 industry groups in the index finished higher, with technology the only group that fell.
The market rose throughout the day as investors got back to focusing on corporate earnings and economic data. American Express and Verizon rose the most in the Dow Jones industrial average after reporting earnings that beat expectations from financial analysts.
The Dow ended the day down two points, or 0.01%, to 15,371.65. The index of 30 big US companies was held back by declines in IBM, Goldman Sachs and UnitedHealth.
IBM's third-quarter revenue fell and missed Wall Street's forecast by more than 1 billion US dollars. The stock closed down 11.90 US dollars, or 6%, at 174.80 US dollars. Earlier, it had touched its lowest level of the past year - 172.57 US dollars.
Goldman Sachs also weighed down the index. The investment bank's revenue fell sharply as trading in bonds and other securities slowed. Goldman fell 3.93 US dollars, or 2.4%, to 158.32 US dollars.
The focus on earnings is a change of pace for Wall Street, which had been absorbed in Washington's political drama over the last month.
Now that the US has avoided the possibility of default, at least for a few months, earnings news is expected to dominate trading for the next couple weeks.
So far, only 79 companies in the S&P 500 have reported third-quarter results, according to S&P Capital IQ. Analysts expect earnings at those companies to increase 3.3% over the same period a year ago.
"I don't think we can completely close the door on the debt ceiling chapter just yet, but we can get back to the stuff that really matters," said Jonathan Corpina, who manages trading on the floor of the New York Stock Exchange for Meridian Equity Partners.
Other indexes also posted noticeable gains. The Nasdaq composite closed up 23.71 points, or 0.6%, to 3,863.15.
The Russell 2000 index, which is made up of primarily smaller, riskier companies, also hit an all-time high. It closed up 9.85 points, or 0.9%, to 1,102.27 and has risen nearly 30 % this year.
Market analysts think the 16-day partial shutdown of the government caused billions of dollars of damage to the economy. Government employees were sent home on unpaid leave, contracts were delayed, and tourism declined at national parks.
Analysts at Wells Fargo said the shutdown probably lowered economic growth by 0.5 percentage points.
There remain broader concerns that Democrats and Republicans will not be able to draw up a longer-term budget. The deal approved late yesterday only permits the Treasury Department to borrow until February 7 and fund the government until January 15.
"The agreement represents another temporary fix that pushes fiscal uncertainty into the early months of next year," Wells Fargo analysts said.
Despite the worries, signs of normality returned to financial markets today.
The one-month Treasury bill was back to trading at a yield of 0.01%, about where it was a month ago, and down sharply from 0.35% on Tuesday.
Usually a staid, conservative security, the one-month Treasury bill was subjected to a wave of selling at the beginning of the month.
Investors feared it would be the first piece of government debt to be affected by a US default if the debt ceiling was breached and the federal government could no longer pay its obligations.