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OCTOBER 23, 2019 / 6:11 pm
Wall Street ticks higher, but chip stocks tumble
DJ: 26,788.10 -39.54 NAS: 8,104.30
-58.69 S&P: 2,995.99
-10.73 10/22
DJ: 26,833.95 +45.85 NAS: 8,119.79 +15.50 S&P: 3,004.52
+8.53 10/23
NEW
YORK (Reuters) - U.S. stocks edged higher on Wednesday as investors shrugged
off lackluster quarterly reports from industrial bellwethers Boeing Co (BA.N)
and Caterpillar Inc (CAT.N), though a lower-than-expected revenue outlook
from Texas Instruments Inc (TXN.O)
sent chipmakers’ shares lower. Shares of
Boeing and Caterpillar rose more than 1% despite significant earnings misses
from both companies. Boeing reported a 53% drop in quarterly profit but
reaffirmed the timeline for its grounded 737 MAX’s return to service.
Caterpillar’s Asian sales tumbled, but the company said tariffs stemming from
the U.S.-China trade war would have a smaller impact on its business than
previously forecast.
With no new developments in trade relations, focus turned to
earnings and other announcements from individual companies. Boeing and
Caterpillar’s shares were resilient, several analysts said, because the companies’ slide in earnings was
expected given the challenges they have faced throughout the year. “Caterpillar has certainly been beset by trade war impact, so it
wasn’t necessarily all that surprising,” said Shannon Saccocia, chief
investment officer at Boston Private. “Boeing has had its own issues from the
perspective of the 737 MAX.” Texas Instruments shares,
however, tumbled 7.5%
after the chipmaker projected fourth-quarter revenue below Wall Street estimates. The results
sent shares of other semiconductor companies, including Intel Corp (INTC.O)
and Broadcom Inc (AVGO.O), lower as well. The Philadelphia SE Semiconductor Index dropped
1.9%.
The
Dow Jones Industrial Average .DJI rose 45.85 points, or 0.17%, to 26,833.95,
the S&P 500 .SPX gained 8.53 points, or 0.28%, to 3,004.52
and the Nasdaq Composite .IXIC added 15.50 points, or 0.19%, to 8,119.79.
Advances
in Apple Inc (AAPL.O) and Facebook Inc (FB.O)
shares helped buoy the major indexes. Apple
shares rose 1.3% after Morgan Stanley said the iPhone maker’s
soon-to-be-launched video streaming service, Apple TV+, could boost its services revenue. Facebook shares advanced 2.1% after Chief
Executive Mark Zuckerberg sought to reassure U.S. lawmakers about the company’s
planned digital currency, Libra.
Nike
Inc (NKE.N) shares fell 3.4% after the sportswear company announced late on Tuesday
that Mark Parker, its long-time CEO, would step down next year. Nike tapped
John Donahoe, chief executive of ServiceNow Inc (NOW.N), as
Parker’s successor. ServiceNow shares fell 3.6%. Shares of medical device maker Boston Scientific Corp (BSX.N) and
laboratory equipment maker Thermo
Fisher Scientific Inc (TMO.N) jumped after both companies
reported strong results. Boston Scientific shares ended 5.0% higher and
Thermo Fisher shares closed up 5.7%. Eli Lilly and Co (LLY.N)
shares, however, fell 2.2%
after the drugmaker missed
third-quarter revenue estimates.
Advancing issues outnumbered declining ones on the NYSE by a
1.75-to-1 ratio; on Nasdaq, a 1.17-to-1 ratio favored advancers. The S&P 500 posted 22 new 52-week highs
and one new low; the Nasdaq Composite recorded 52 new highs and 61 new lows.
Volume on U.S. exchanges
was 6.11 billion shares,
compared to the 6.46 billion average for the full session over the last 20
trading days.
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