S&P 500 at five-month high, but banks weigh after results
FILE PHOTO: Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., July 11, 2018. REUTERS/Brendan McDermid
NEW YORK: U.S. stocks edged higher on Friday, with the S&P 500 hitting a more than five-month high, as gains in industrials and other areas offset a drop in financials after results from three big Wall Street banks mostly disappointed investors.The industrial sector gained 0.6 percent, with Boeing, Caterpillar and 3M all up more than 1 percent, in the absence of any trade rhetoric overnight.
Treasury Secretary Steven Mnuchin said the United States and China could reopen trade talks if Beijing was willing to make significant changes.Oil prices rose over 1 percent as strike actions in Norway and Iraq hit supplies, boosting the energy sector 0.89 percent, the most among the 11 S&P sectors.These gains helped the S&P hit 2,804.53, its highest since Feb. 2. The index is now about 2.5 percent from its all-time high of 2,872.87, hit on Jan. 26.As the trade row continues, investors are looking ahead to what is expected to be a strong second-quarter earning season, though reports on Friday from three of the biggest U.S. banks failed to enthuse.
"There's pretty impressive resilience in spite of the disappointment from the financials, which have been and continue to be a laggard. Even in the face of that, there's still relative strength," said Michael James, managing director of equity trading at Wedbush Securities in Los Angeles.Earnings "expectations are certainly elevated from where they were a month ago, but if companies do deliver in general, even with elevated expectations, I believe the market as a whole will continue to move higher, and it will not result in a sell-the-news reaction," he said.Citigroup slid 1.8 percent, the most among financials, after its revenue fell short of estimates due to lower debt underwriting. Wells Fargo dipped 1.0 percent after its profit fell more than expected as lending slowed and costs rose.JPMorgan shares were down 0.4 percent though the bank's profit beat estimates. The financial index fell 0.5 percent.
The Dow Jones Industrial Average rose 96.83 points, or 0.39 percent, to 25,021.72, the S&P 500 gained 2.82 points, or 0.10 percent, to 2,801.11 and the Nasdaq Composite added 0.49 points, or 0.01 percent, to 7,824.41.Netflix sank 3.8 percent after Deutsche Bank warned the company could fall short of subscriber growth numbers when it reports results on Monday.Johnson & Johnson dropped 1.4 percent after a jury ordered it to pay a record US$4.69 billion to 22 women who alleged its talc-based products contain asbestos and caused them to develop ovarian cancer.AT&T Inc's shares fell 1.9 percent on the U.S. Justice Department's plan to appeal a federal judge's approval of the company's already closed US$85.4 billion acquisition of Time Warner.Advancing issues outnumbered declining ones on the NYSE by a 1.01-to-1 ratio; on Nasdaq, a 1.16-to-1 ratio favored decliners.The S&P 500 posted 38 new 52-week highs and 2 new lows; the Nasdaq Composite recorded 89 new highs and 38 new lows(Additional reporting by Amy Caren Daniel in Bengaluru; Editing by Shounak Dasgupta and Nick Zieminski)
Source : http://www.channelnewsasia.com/news/business/s-p-500-at-five-month-high--but-banks-weigh-after-results-10528658