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US stocks veer higher in midday trade; oil slides
May 16, 2018 Updated: May 16, 2018 11:49am
FILE- In this April 26, 2018, file photo, Vincent Pepe enjoys some fresh air outside the New York Stock Exchange where he works in the Financial District in New York. The U.S. stock market opens at 9:30 a.m. EDT on Wednesday, May 16.
U.S. indexes rose in afternoon trading Wednesday, led by gains in big technology names, health care companies and retailers. Macy’s led a rally among retailers after reporting surprisingly strong results. Consumer goods companies also posted gains. Safe-play stocks like utilities and real estate companies lagged the market. Energy stocks also fell as crude oil prices declined.
KEEPING SCORE: The S&P 500 index rose 14 points, or 0.6 percent, to 2,726 as of 12:45 p.m. Eastern Time. The Dow gained 79 points, or 0.3 percent, to 24,785. The Nasdaq composite added 57 points, or 0.8 percent, to 7,408. The Russell 2000 index of smaller-company stocks picked up 13 points, or 0.8 percent, to 1,613.
THE QUOTE: “Earnings growth has shown through and that’s been primarily based on strong fundamental growth from U.S. companies,” said Jamie Lavin, global investment specialist at J.P. Morgan Private Bank. “And when equity markets are able to look through to that and we don’t have any major geopolitical headlines, we tend to have stronger days in the market.”
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TECH TURN: Technology sector companies notched solid gains. Micron Technology rose 4.2 percent to $56.28.
RETAIL RALLY: Macy’s jumped 10.6 percent to $33.10 after reporting quarterly results that were far better than analysts were expecting. The company said its Bloomingdale’s and Bluemercury divisions as well as its flagship store brand all did well. Several other retailers also moved higher. Nordstrom added 1.2 percent to $50.45, while L Brands gained 3.1 percent to $34.33. Target shares picked up 3.2 percent to $75.42.
ENCOURAGING UPDATE: Office Depot climbed 5.1 percent to $2.46 after the office supply company maintained its forecasts for the year.
FIDO APPROVED: Abaxis vaulted 15.8 percent to $83.09 after the veterinary diagnostic products company agreed to be acquired by Zoetis.
WARREN’S WAY: Teva Pharmaceutical Industries added 3 percent to $20.90 after Warren Buffett’s company Berkshire Hathaway more than doubled the size of its investment in the Israeli drugmaker. Phillips 66 slipped 0.6 percent to $117.60 after the Berkshire sold about half of its investment in the oil and gas company.
BOND YIELDS: Bond prices were little changed. The yield on the 10-year Treasury held steady at 2.07 percent. On Tuesday, the yield climbed to its highest level in nearly seven years.
Utilities and other high-dividend paying stocks declined Wednesday, added to losses from a day earlier. Duke Energy fell 1.7 percent to $75.60.
ENERGY: Benchmark U.S. crude oil gave up 39 cents to $70.92 a barrel in New York. Brent crude, used to price international oil, shed 28 cents to $78.15 a barrel in London.
CURRENCIES: The dollar fell to 110.16 yen from 110.38 yen on Tuesday. The euro weakened to $1.1793 from $1.1847.
MARKETS OVERSEAS: Major indexes in Europe rose. Germany’s DAX gained 0.2 percent, while France’s CAC 40 added 0.3 percent. Britain’s FTSE 100 rose 0.1 percent. In Asia, Japan’s Nikkei 225 stock index lost 0.4 percent following new data showing that Japan’s economy contracted in the first quarter. The Kospi in South Korea was essentially flat. Hong Kong’s Hang Seng slipped 0.1 percent.