October is one month that terrifies investors, thanks to its notorious past. Historically, this month has been the most volatile and has triggered the biggest sell-offs on multiple occasions including 1929 crash as well as the infamous 2008 financial crisis.
This October, it was no different in terms of volatility and stock sell-offs. So far, there have already been three trading days when the S&P 500 index recorded more than 1% single-day declines.
Hurt by last week’s sell-offs, as on Monday, Dow Jones Industrial Average was down 4.2%, while the S&P 500 index had declined about 5% in October. Nasdaq witnessed the biggest month-to-date fall of 6.8%.
While Octoberphobia seemed once again tightening its clutches, all it took for Wall Street to break free was a single day of market-beating quarterly results. Led by outperforming stocks including Goldman Sachs (GS) and United Health Group (UNH), the Dow Jones Industrial Average gained 276 points as markets opened on Tuesday. The Nasdaq Composite and S&P 500 also reacted positively, gaining 1.4% and 1% respectively.
UNH shares jumped 4% during morning trade after the company posted better-than-expected results and raised full-year outlook. America’s fifth largest bank by assets, Goldman Sachs (GS), meanwhile, reported a 25% increase in earnings, sending its shares up 1.8% during morning trade.
Other major companies, Morgan Stanley (MS) and Johnson & Johnson (JNJ) also provided enough backing. While Morgan Stanely is up 4.5% at 11:30AM ET, JNJ has risen 1.65%.
Investors are now closely watching Netflix (NFLX), which is scheduled to report earnings aftermarket today. If the streaming giant manages to surprise the Wall Street with its third-quarter results, and also buck speculations that further steady growth is impossible in user base, it would provide further relief to Octoberphobia concerns.