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JPMorgan ( JPM ), Wells Fargo ( WFC ) up after Q3 results

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Tesla falls after unveiling robotaxi

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Monthly PPI unchanged

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Indexes up: Dow 0.81%, S&P 500 0.61%, Nasdaq 0.37%

(Updated at 11:58 a.m. ET/1558 GMT)

By Lisa Pauline Mattackal and Pranav Kashyap

Oct 11 (Reuters) -

The S&P 500 and the Dow hit record highs on Friday, driven

by gains in major banks following third-quarter results, while

the latest producer price data backed expectations for a

25-basis-point rate reduction by the U.S. Federal Reserve in

November.

Major financial companies kicked off the earnings season on

the day, with JPMorgan Chase ( JPM ) rising 5% after the lender

reported higher-than-expected third-quarter profit and raised

its annual interest income forecast.

Wells Fargo ( WFC ) rose 5.7%, after its profit also beat

analysts' expectations. BlackRock gained 3.1% after the

asset manager reported its assets under management had hit a

record high for the third straight quarter.

Other financial stocks rose broadly, with the Financials

index climbing 1.9% to a record high, the S&P 500 Banks

index rising 4.5% to its highest since February 2022,

and an index of regional lenders up 3%.

However, a 7.8% slump in Tesla limited gains on

the Nasdaq after the EV maker unveiled its long awaited

robotaxi, but did not provide details on how fast it could ramp

up production or deal with potential regulatory hurdles.

Meanwhile, data from the U.S. Department of Labor showed

the

Producer Price Index

for final demand was unchanged on a monthly basis in

September, compared to the 0.1% rise expected by economists

polled by Reuters.

Traders kept bets steady on a 25-basis-point rate cut by

the central bank in November, pricing in a nearly 88% chance,

according to CME's FedWatch.

The data comes after Thursday's

Consumer Price Index

data, which was slightly higher than forecast, although

weekly jobless claims rose more than expected.

"(The Fed) is trying to thread the needle between not

creating inflation through accommodative policy, but not letting

the labor markets fall apart. The conflicting data over the last

week shows that challenge," said Matt Rowe, head of portfolio

management and cross asset strategies at Nomura Capital

Management.

The Dow Jones Industrial Average rose 344.19

points, or 0.81%, to 42,798.31, the S&P 500 gained 34.85

points, or 0.61%, to 5,815.15, and the Nasdaq Composite

gained 66.54 points, or 0.37%, to 18,349.13.

All three major indexes were on track to notch their

fifth consecutive week of gains.

With major indexes trading around record highs and the

benchmark S&P 500 up more than 21% year-to-date, the

third-quarter results will test if 2024's rally can be

sustained.

"The success of banks this quarter won't be universal.

With valuations where they are... I would say outperformance is

already priced in to some degree," Rowe said.

Federal Reserve Board Governor Michelle Bowman is expected

to speak later in the day.

Meanwhile, a preliminary reading of the University of

Michigan's October consumer sentiment index stood at 68.9,

compared with analysts' estimate of 70.8.

Advancing issues outnumbered decliners by a 3.59-to-1

ratio on the NYSE, and by a 2.95-to-1 ratio on the Nasdaq.

The S&P 500 posted 61 new 52-week highs and one new low,

while the Nasdaq Composite recorded 107 new highs and 64 new

lows.