U.S. Stocks Rise As Health Care And Industrial Companies Climb

NEW YORK (AP) — U.S. stocks are rising Tuesday after a three-day losing streak. Industrial and health care companies are making some of the largest gains following strong second-quarter reports. Bloomberg News reported that the U.S. and China are trying to restart trade talks. The Commerce Department said consumer spending kept growing in June and a key measurement of inflation stayed near the Federal Reserve’s target of 2 percent.

KEEPING SCORE: The S&P 500 index rose 18 points, or 0.7 percent, to 2,821 as of 2 p.m. Eastern time. It’s on track to make up for its loss on Monday. The Dow Jones Industrial Average gained 165 points, or 0.6 percent, to 25,472. The Nasdaq composite added 58 points, or 0.8 percent, to 7,688. The Russell 2000 index of smaller-company stocks jumped 16 points, or 1 percent, to 1,669.

INDUSTRIAL STRENGTH: Bloomberg reported that representatives of the U.S. and China are looking for ways to open new talks to end the trade war between them. The report cited two people familiar with those efforts and said there was no agreement about a time frame for talks or what issues would be discussed.

The trade dispute could affect sales for many industrial companies. New taxes on aluminum and steel imports are also sending costs for those companies higher. Farm equipment maker Deere, which is threatened by China’s tariffs on soybeans, surged 5.1 percent to $145.25. Engine maker Cummins gained 4.9 percent to $143.93 after a better-than-expected second-quarter report. After a slump on Monday, construction equipment maker Caterpillar rose 3.5 percent to $144.69.

EARNINGS: Genetic testing tools maker Illumina raised its forecasts after a strong second quarter and its stock climbed 10.1 percent to $318.41. Pfizer rose 2.8 percent to $39.66 after the biggest U.S. drugmaker topped analysts’ projections and raised its forecasts for the year.

Strong earnings also helped real estate companies. Apartment building owner AvalonBay jumped 2.9 percent to $177.24 and wireless infrastructure company American Tower gained 4.6 percent to $149.30.

Elsewhere, cable company Charter Communications advanced 3.9 percent to $305.26 after its quarterly profit surpassed analysts’ estimates.

High-powered laser maker IPG Photonics nosedived 25.8 percent to $166.33 after it said demand from Europe and China worsened during the second quarter. The company’s revenue forecast for the current quarter fell far short of Wall Street’s estimates.

TECH COMEBACK: Technology stocks edged higher after three days of sharp losses. Chip equipment maker KLA-Tencor soared 9.9 percent to $116.80 after it topped Wall Street expectations in the second quarter. Chipmaker Qualcomm gained 3.5 percent to $64.20 as it started to buy back stock from shareholders. Apple, which will report its quarterly results after the close of trading, added 0.7 percent to $191.22.

The technology index of the S&P 500 fell 5.3 percent over the past three days, its worst decline in three months. It’s up 0.5 percent Tuesday, slightly less than the S&P 500.

US ECONOMY: The Commerce Department said consumer spending grew another 0.4 percent in June, and a key measurement of inflation is up 2.2 percent over the last year. For the last four months, inflation has equaled or been slightly higher than the Federal Reserve’s target of 2 percent. The Fed is meeting Tuesday and Wednesday but isn’t expected to raise interest rates again until later this year.

The Labor Department said wages and benefits for U.S. workers continued to rise, but they grew at a slightly slower pace in the second quarter. That’s a sign that a tight labor market has yet to accelerate income gains.

BONDS: Bond prices rose. The yield on the 10-year Treasury note fell to 2.96 percent from 2.97 percent.

BOJ MEETING: The Bank of Japan maintained its target for the 10-year government bond yield at around zero percent and that for short-term interest rates at minus 0.1 percent. Recent strength in Japan’s economy had raised expectations that the central bank may need to consider further tempering its massive purchases of government bonds and other assets.

OVERSEAS: Economic growth in the 19-country eurozone slowed to 0.3 percent in the second quarter as trade tensions between the U.S. and Europe hurt business confidence. Since then, the EU and U.S. have agreed to hold off more tariffs and try to free up trade, though details remain hazy.

The French CAC 40 rose 0.4 percent and the British FTSE 100 gained 0.6 percent. The DAX in Germany added 0.1 percent. Japan’s Nikkei 225 index rose less than 0.1 percent and South Korea’s Kospi added 0.1 percent. Hong Kong’s Hang Seng index fell 0.5 percent.

ENERGY: Benchmark U.S. crude lost 1.6 percent to $68.98 per barrel in New York. Brent crude, used to price international oils, fell 1.6 percent to $74.34 a barrel in London.

METALS: Gold rose 0.2 percent to $1,223.60 an ounce. Silver added 0.1 percent to $15.56 an ounce. Copper rose 1.4 percent to $2.83 a pound.

CURRENCIES: The dollar rose to 111.82 yen from 111 yen. The euro slipped to $1.1700 from $1.1710.

By MARLEY JAY - JULY 31. 2018 - 2:27 PM EDT
AP

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AP Markets Writer Marley Jay can be reached at http://twitter.com/MarleyJayAP His work can be found at https://apnews.com/search/marley%20jay

 
 

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