wed JANUARY 23, 2019 /4:29 pm
Wall Street edges higher as upbeat
earnings dampened by trade, shutdown woes
DJ: 24,575.62 +171.14 NAS: 7,025.77 +5.41 S&P: 2,638.70
+5.80 1/23
(Reuters) - Wall Street
ended slightly higher on Wednesday after a spate of upbeat earnings reports,
but lingering concerns about trade tensions and the longest U.S. government
shutdown ever limited the advance. All
three major U.S. stock indexes closed in positive territory, with the blue chip
Dow Jones Industrial Average seeing the biggest gains on positive quarterly
results from International Business Machines (IBM.N), Procter & Gamble Co (PG.N) and United Technologies (UTX.N). Investor
sentiment was dampened by reports that business leaders gathered at the World
Economic Forum in Davos, Switzerland, were losing confidence in President
Donald Trump’s policies that have resulted in the prolonged U.S.-China trade
stand-off.
Uncertainty persisted in
Washington, where no end to
the longest-ever federal government shutdown appeared to be in sight. The United States could see zero growth in the first
quarter if the shutdown extends through March, according to White House
economic adviser Kevin Hassett on Wednesday.
“The headlines coming out of Davos are rehashing some of the
pessimism,” said Matthew Keator, partner in the Keator Group, a wealth
management firm in Lenox, Massachusetts.
“We are in a more
anxious market here, coming off the lows of the fourth quarter,” Keator
added. “People’s wounds are still fresh.”
Still, a spate of positive earnings helped boost the Dow.
IBM provided the biggest boost to the Dow,
rising 8.5 percent after cloud and software services helped its profit come in above analyst
estimates and the company offered better-than-expected guidance for
2019. Procter & Gamble advanced 4.9 percent after
the company upped its
full-year sales forecast and took advantage of price increases and
strong demand to beat analyst earnings estimates. United Technologies reported a better-than-expected fourth-quarter profit and
forecast 2019 earnings above analyst estimates. The industrial conglomerate’s
stock ended the session 5.4 percent higher.
The
Dow Jones Industrial Average .DJI rose 171.14 points, or 0.7 percent, to
24,575.62, the S&P 500 .SPX gained 5.80 points, or 0.22 percent, to
2,638.70 and the Nasdaq Composite .IXIC added 5.41 points, or 0.08 percent, to 7,025.77.
Of the 11 major sectors of the S&P 500, only energy .SPNY
and materials .SPLRCM closed in the red.
Fourth-quarter reporting
season is in full swing, and of the 15 percent of S&P 500 companies that
have reported, 77.6 percent have beaten analyst estimates, according to Refinitiv data. Analysts now see S&P 500 earnings growth of 14.2 percent in
the quarter.
Comcast Corp (CMCSA.O) rose 5.5 percent after the top U.S.
cable service provider posted better-than-expected earnings and announced it would raise its
dividend by 10 percent. Shares of Tesla Inc (TSLA.O) dropped 3.8 percent after the electric
automaker said it was reducing production hours for higher-priced Model S and
Model X cars, days after announcing
job cuts.
After the bell, Ford Motor Co (F.N) reported lower operating profit in the fourth quarter,
weighed down by losses in every global region but North America.
Advancing issues outnumbered declining ones on the NYSE by a
1.05-to-1 ratio; on Nasdaq, a 1.02-to-1 ratio favored decliners. The S&P 500 posted 4 new 52-week highs
and 1 new low; the Nasdaq Composite recorded 16 new highs and 45 new lows.
Volume on U.S. exchanges
was 6.83 billion shares,
compared to the 7.82 billion average over the last 20 trading days.
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