By Trevor Hunnicutt
NEW YORK (Reuters) - Global stocks extended their rally into a fourth consecutive day on Wednesday as investor optimism over corporate earnings trumped concern about the trade war.
Investors turned their focus to market-leading technology stocks, seen as less likely to be hurt by trade tensions. They had earlier fretted over threats of retaliatory taxes on U.S. goods from Europe and General Motors cutting its earnings forecast due to the costs those taxes impose.
U.S. President Donald Trump struck a conciliatory tone as he welcomed the head of the European Commission, Jean Claude-Juncker, to the White House for talks.
"We have seen a lot of complacency over this entire trade war so the question is, unless we see a very negative outcome (from the EU-U.S. meeting), are we going to see a marked reaction?" Rabobank strategist Bas Van Geffen said.
Amid the busiest reporting week for S&P 500 companies, a European Central Bank meeting and U.S. GDP figures still to come this week, there is scope for volatility.
Sales of new U.S. single-family homes fell to an eight-month low in June and data for the prior month was revised sharply lower, the latest indications that the housing market is slowing down. The PHLX housing index <.HGX> fell 2.06 percent.
But markets focused on the positive. Of the 148 S&P 500 companies that have reported second-quarter earnings so far, nearly 86 percent have topped Wall Street forecasts, a record dating back to 1994, according to Thomson Reuters I/B/E/S.
The Dow Jones Industrial Average <.DJI> rose 3.62 points, or 0.01 percent, to 25,245.56, the S&P 500 <.SPX> gained 10.92 points, or 0.39 percent, to 2,831.32 and the Nasdaq Composite <.IXIC> added 56.06 points, or 0.71 percent, to 7,896.83.
MSCI's gauge of stocks across the globe <.MIWD00000PUS> gained 0.34 percent.
The dollar index, which measures the greenback against a basket of six major currencies <.DXY>, fell 0.27 percent, further scaling down from its July 19 peak for the year, when Trump suggested it had grown too strong.
Richard Bernstein, chief executive of Richard Bernstein Advisors LLC, said tariffs and weak-dollar policies could exacerbate pressure on company profits.
"I'm very surprised that analysts have not factored any of this in - that people are shocked that tariffs are inflationary," said Bernstein.
Gold, used to guard against inflation, added 0.6 percent to $1,231.71 an ounce on the spot market
Yields on the 10-year Treasury note
Bond investors were whipsawed this month by speculation the Bank of Japan could start unwinding stimulus and by bets that the gap between short and long-term bond yields would widen if Trump pressured the Federal Reserve to stop dollar-boosting rate hikes. The latter wager - on a "steeper" yield curve - unwound for a second straight day.
Benchmark 10-year notes rose 3/32 in price to yield 2.9412 percent, and the gap between 2 and 10-year yields shrank to 28.2 basis points, from highs above 33 basis points on Tuesday.
Oil prices rose for a second day after U.S. crude inventories fell to the lowest since February 2015, easing worries about oversupply.
(Reporting by Trevor Hunnicutt; Additional reporting by Stephanie Kelly in New York and Marc Jones in London; Editing by Bernadette Baum and Nick Zieminski)
This story has not been edited by Firstpost staff and is generated by auto-feed.
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Updated Date: Jul 26, 2018 01:05:22 IST