By Sue Chang and Anora Mahmudova, MarketWatch
Nasdaq on track for record close
The stock market rallied Thursday, with the Nasdaq poised for a
record finish as investors welcomed on a deluge of
stronger-than-expected corporate earnings reports and economic
data.
Reports that House Republicans may be reaching a deal to repeal
and replace Obamacare also boosted sentiment, analysts said.
The S&P 500 climbed 21 points, or 0.9%, to 2,359. Financials
and materials topped the gainers.
The Dow industrials gained 204 points, or 1%, to 20,609,
recovering its losses form the previous session. American Express
Co(AXP) was the best performer among blue-chips, up more than 5%,
following earnings.
The Nasdaq Composite rose 58 points, or 1%, to 5,921, above the
record close of 5,914.34 on March 30.
"There is a lot of good news when it comes to earnings and
economic data and not only in the U.S. but overseas as well," said
Karyn Cavanaugh, senior market strategist at Voya Financial.
"It's almost as if investors are realizing that a selloff
yesterday because of a drop in oil was not warranted," Cavanaugh
said.
West Texas Intermediate crude futures for May, staged a rebound
from Wednesday's slump, to trade at $50.48 a barrel. Futures
suffered their largest decline in weeks
(http://www.marketwatch.com/story/oil-steadies-as-investors-await-eia-inventory-report-2017-04-19)
on Wednesday after a surprise climb in U.S. gasoline supplies. On
Thursday, Saudi Arabia's energy minister, Khalid al-Falih, said the
Organization of the Petroleum Exporting Countries is likely to
reach a deal to extend the group's production cuts into the latter
half of 2017
(http://www.marketwatch.com/story/opec-set-to-extend-output-deal-says-saudi-energy-minister-2017-04-20).
"Investors are paying too much attention to OPEC, but it's
really the U.S. that is driving the supply glut with its shale
production. We expect the oil price to continue to fluctuate within
$45-$50 a barrel," said Cavanaugh.
Media reports of a potential breakthrough
(http://www.cnn.com/2017/04/20/politics/health-care-congress-republicans/?link=mktw)
among key House Republicans to secure more support for a new
healthcare bill that would replace Obamacare has helped to spur
stocks higher.
"The market got a little aggressive on the news given the domino
effect that the healthcare bill would have," said Mark Kepner,
managing director of sales and trading at Themis Trading
President Donald Trump has prioritized the healthcare bill over
other policies, including introducing tax reforms, and the failure
of the Republicans to vote on the American Health Care Act last
month has hemmed in the market.
Economic front: "The trend of the market is down and is not
likely to reverse until clarity of the underlying fear factors are
put to rest," said Peter Cardillo, chief market economist for First
Standard Financial, in a note, referencing investor jitters over
the impending French election, and tensions on the Korean
Peninsula.
Initial jobless claims rose by 10,000 to a still-low 244,000 in
mid-April. Meanwhile, the number of out-of-work people collecting
unemployment checks fell to a 17-year low
(http://www.marketwatch.com/story/number-of-people-collecting-unemployment-checks-hits-17-year-low-jobless-claims-show-2017-04-20)
last week, underscoring the strongest U.S. labor market in
years.
The manufacturing index from the Philadelphia Fed slid in April
(http://www.marketwatch.com/story/philadelphia-fed-factory-gauge-slides-again-from-33-year-high-but-remains-elevated-2017-04-20),
but from high levels, suggesting slower growth in the factory
sector after a postelection surge.
Federal Reserve Governor Jerome Powell, speaking about capital
markets and the economy, said now was a good time to review the
raft of banking regulations put in place since the financial
crisis.
Stocks to watch: Shares of Philip Morris International Inc.(PM)
fell more than 4% after the company fell short of earnings and
first-quarter profit expectations
(http://www.marketwatch.com/story/philip-morris-shares-slump-after-earnings-miss-2017-04-20).
Foot Locker Inc.(FL) shares initially fell but rebounded to
trade 5% higher even after the athletic apparel group issued a
profit warning.
(http://www.marketwatch.com/story/foot-locker-shares-slide-after-profit-warning-2017-04-20)
(http://www.marketwatch.com/story/foot-locker-shares-slide-after-profit-warning-2017-04-20)Blackstone
Group L.P.(BX) reported profit that nearly tripled, but missed
expectations. Still, shares were up nearly 1.4%.
Verizon Communications Inc.(VZ) shares fell 0.9% after the
telecom company reported first-quarter earnings that missed Wall
Street expectations.
EBay Inc.(EBAY) shares dropped 3.1% after earnings.
Qualcomm Inc.(QCOM) shares were down 0.4% even after the chip
designer beat earnings expectations
(http://www.marketwatch.com/story/qualcomm-gains-after-beating-earnings-expectations-despite-apple-legal-beef-2017-04-19).
(http://www.marketwatch.com/story/qualcomm-gains-after-beating-earnings-expectations-despite-apple-legal-beef-2017-04-19)United
States Steel Corp.(X) shares soared 7.4% on reports that President
Trump has ordered a probe into whether foreign steel products are
hurting national security.
(http://www.marketwatch.com/story/qualcomm-gains-after-beating-earnings-expectations-despite-apple-legal-beef-2017-04-19)Visa
Inc.(V) and Mattel Inc.(MAT) are due to report after the close.
Other markets: The Nikkei 225 Index rose for a fourth straight
session, leading a recovery for Asia markets
(http://www.marketwatch.com/story/nikkei-up-for-4th-straight-session-leading-asian-market-recovery-2017-04-19).
European stocks were higher, while the U.K.'s FTSE 100 index
(http://www.marketwatch.com/story/unilever-shares-push-ftse-toward-first-win-in-5-days-2017-04-20)
finished in the red.
However, the French CAC 40 index rallied more than 1%
(http://www.marketwatch.com/story/french-stocks-rise-ahead-of-european-peers-despite-election-worries-2017-04-20)
after a Harris Interactive poll signaled a win for centrist
Emmanuel Macron in Sunday's first-round presidential election.
Read:Here's how France's hotly contested election could spark
market turmoil
(http://www.marketwatch.com/story/heres-how-frances-hotly-contested-election-could-spark-market-turmoil-2017-04-19)
Gold prices and the U.S. Dollar Index were both little
changed.
--Barbara Kollmeyer contributed to this report.
(END) Dow Jones Newswires
April 20, 2017 13:54 ET (17:54 GMT)
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