U.S. Stock Indexes Veer Mostly Higher After Paring Early Gains

Trader Gordon Charlop works on the floor of the New York Stock Exchange, Tuesday, July 24, 2018. Stocks are opening broadly higher on Wall Street as investors were pleased to see strong earnings reports from a number of U.S. companies. (AP Photo/Richard Drew)

U.S. stock indexes were mostly higher Tuesday afternoon after paring some of their gains from earlier in the day. Banks, health care companies and technology stocks accounted for most the market’s gains. Energy stocks also rose along with crude oil prices. Consumer goods manufacturers and utilities stocks were among the laggards. Investors were mostly focused on the latest quarterly results from companies in what was shaping up to be the busiest week yet of the earnings season.

KEEPING SCORE: The S&P 500 index rose 7 points, or 0.3 percent, to 2,814 as of 2 p.m. Eastern Time. The Dow Jones Industrial Average gained 149 points, or 0.6 percent, to 25,193. The Nasdaq composite lost 22 points, or 0.3 percent, to 7,819. The Russell 2000 index of smaller-company stocks slid 13 points, or 0.8 percent, to 1,684. The S&P 500, the market’s benchmark index, is on a three-week winning streak.

THE QUOTE: “Investors are focused on the good news on earnings and the economy, but they’re still a bit cautious when it comes to the market moving higher, and that’s because of all the news flow on geopolitical events and tariffs,” said Jeff Kravetz, regional investment strategist at U.S. Bank Private Wealth Management.

EARNINGS ON DECK: This is the busiest week for the second-quarter earnings season, with roughly a third of companies in the S&P 500 scheduled to report, including Amazon, Facebook, Boeing and Ford Motor. Of the 17.4 percent of the companies in the S&P 500 that had issued quarterly results as of Monday, some 71 percent reported earnings and revenue that beat analysts’ forecasts, according to S&P Global Market Intelligence. That’s reinforced the underlying perception in the financial markets that the U.S. economy is performing strongly and that the Federal Reserve will raise interest rates next month.

Even so, traders remain wary of global trade tensions, which have ratcheted up in recent weeks as the Trump administration has sought to renegotiate trade pacts with China, Canada and European nations, resorting to imposing tariffs on imports of aluminum, steel and other goods. The strategy has has prompted U.S. trading partners to retaliate, creating risks for the economy.

AGOG OVER GOOGLE: Google parent Alphabet gained 3.4 percent to $1,251.84 after the company reported second-quarter earnings late Monday that topped Wall Street’s expectations even as it booked a $5.1 billion charge to cover a fine levied by European regulators. Alphabet led the market-leading rally in technology stocks.

REVVED UP: Harley-Davidson vaulted 6.4 percent to $44.11 after the motorcycle manufacturer’s latest quarterly earnings came in well ahead of what analysts were expecting. The company also said it’s planning strategic changes as tariffs affect its business.

GOOD MEDICINE: Biogen added 3.5 percent to $370.70 after the drugmaker posted strong quarterly results and raised its forecast for the year.

SOLID QUARTER: Eli Lilly & Co. gained 3 percent to $91.56 after the drug company’s quarterly results beat Wall Street estimates. The company also said it will spin off its animal health business.

ON THE FARM: Investors sent shares in several agriculture sector companies higher following reports that the Trump administration is preparing a plan that would send billions in aid to U.S. farmers hurt by tariffs. Farming equipment manufacturer Deere & Co. climbed 3.7 percent to $140.54. Fertilizer maker Mosaic rose 2.9 percent to $29.21.

SPIN CYCLE: Whirlpool was the biggest decliner in the S&P 500, plunging 14.1 percent to $129.44 after the appliance maker’s latest results came up short of forecasts. The company is being hurt by tariffs on imported aluminum and steel.

BOND YIELDS: Bond prices were little changed. The yield on the 10-year Treasury held steady at 2.96 percent.

OIL: Benchmark U.S. crude climbed 95 cents, or 1.4 percent, to $68.84 per barrel in New York. Brent crude, used to price international oils, gained 78 cents, or 1.1 percent, to $73.84 per barrel in London.

The pickup in oil prices helped lift energy sector stocks. Pioneer Natural Resources added 3.7 percent to $187.95.

CURRENCIES: The dollar fell to 111.27 yen from 111.48 yen on Monday. The euro weakened to $1.1685 from $1.1689.

MARKETS OVERSEAS: In Europe, Germany’s DAX rose 1.1 percent and the CAC 40 in France added 1 percent. The FTSE 100 index of leading British shares gained 0.7 percent. Major indexes in Asia finished higher. Japan’s Nikkei 225 gained 0.5 percent, while South Korea’s Kospi added 0.5 percent. Hong Kong’s Hang Seng jumped 1.4 percent. Australia’s S&P-ASX 200 rose 0.6 percent.

By ALEX VEIGA - JULY 24 2018 - 2:07 PM EDT
AP

 
 

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