Bank stocks rise; oil tumbles

NEW YORK (AP) — U.S. stocks are hanging near their records Tuesday after several big banks delivered stronger profits for the summer than analysts expected, while the price of crude oil tumbled again.

The S&P 500 was up 0.1% in early trading, a day after setting an all-time high for the 46th time this year. The Dow Jones Industrial Average was down 256 points, or 0.6%, as of 9:35 a.m. Eastern time, and the Nasdaq composite was 0.3% higher.

Bank of America and Goldman Sachs both rose rose at least 1% after reporting stronger results for the latest quarter than analysts feared, while Charles Schwab jumped 8.4% after likewise delivering better profit than expected thanks in parts to more customers opening brokerage accounts.

Walgreens Boots Alliance was another winner, up 10.7%, after topping analysts’ forecasts. The drugstore chain also said it will close about 1,200 locations over the next three years as it tries to turn around its struggling U.S. business.

Chipmaker Wolfspeed jumped 35.8% to trim its loss for the year to 64.5% after the Biden-Harris administration announced Tuesday that it plans to provide up to $750 million in direct funding to the company. The money will support its new silicon carbide factory in North Carolina that makes the wafers used in advanced computer chips.

They helped offset a drop of 2.8% for Exxon Mobil and sharp losses for other energy companies after oil prices tumbled more than 4%. A barrel of Brent crude, the international standard, has fallen back below $74 from more than $80 last week for a couple reasons.

China’s flagging economy has raised concerns about weaker-than-expected demand for crude, which could lead to a buildup of too much oil supplies in inventories. Worries have also receded about Israel possibly attacking Iranian oil facilities as part of its pending retaliation against Iran’s missile attack early this month. Iran is a major producer of crude, and the worry beyond such a hit to supplies was that an expanding war could draw in other big oil exporters.

Also dragging on the U.S. stock market was UnitedHealth Group. The insurer fell 9.5% despite reporting better results for the latest quarter than analysts expected. It lowered the top end of its forecasted range for profit over the full year.

In the bond market, trading of Treasurys resumed after a holiday on Monday, and yields slipped following a weaker-than-expected report on manufacturing in New York state.

The yield on the 10-year Treasury fell to 4.05% from 4.10% late Friday. Manufacturing has been one of the areas of the U.S. economy hurt most by high interest rates caused by the Federal Reserve in its efforts to slow the economy enough to stamp out high inflation.

Now, though, the Fed has begun cutting interest rates as it’s widened its focus to include keeping the economy humming instead of just fighting high inflation.

Recent reports showing the U.S. economy remains stronger than expected have also raised optimism that the Fed can pull off a perfect landing where it gets inflation down to 2% without causing a recession that many had thought would be necessary.

In stock markets abroad, Chinese stocks fell sharply as doubts continue about whether the government will offer enough fiscal stimulus to prop up the world’s second-largest economy.

Stocks in Shanghai fell 2.5%, and Hong Kong’s Hang Seng index dropped 3.7%.

Indexes were mixed elsewhere in Asia and in Europe.

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AP Business Writers Matt Ott and Elaine Kurtenbach contributed.