Wall Street rises as Trump touts EU trade concessions

By April Joyner NEW YORK (Reuters) - Wall Street's major indexes rose on Wednesday as U.S. President Donald Trump secured concessions from the European Union on trade.

Reuters July 26, 2018 03:05:28 IST
Wall Street rises as Trump touts EU trade concessions

Wall Street rises as Trump touts EU trade concessions

By April Joyner

NEW YORK (Reuters) - Wall Street's major indexes rose on Wednesday as U.S. President Donald Trump secured concessions from the European Union on trade.

The benchmark S&P 500 jumped more than half a percent in the last half-hour of trading on news of the concessions and closed at its highest level since Jan. 29. Trump said that the United States and the European Union had agreed to work toward eliminating tariffs on industrial goods and increasing U.S. exports of liquefied natural gas and soybeans to Europe.

The S&P and the Nasdaq had already been boosted earlier in the trading session by gains in the technology sector. Shares of Facebook Inc and Microsoft Corp hit record highs earlier in Wednesday's session. Facebook shares closed up 1.3 percent, and Microsoft shares ended the session up 2.9 percent.

In after-hours trading, however, Facebook shares sank as much as 9 percent after data on its monthly active users came in below estimates.

The sanguine news regarding trade helped the Dow reverse earlier losses in Wednesday's session. It had been weighed by Boeing Inc's report of higher costs for its aerial refuelling tanker program. Boeing shares closed down 0.7 percent.

"Once you got a hint of good news about avoiding a trade war, the market was primed to go higher based on the fact that earnings has been quite strong and economic data has been strong," said Michael Antonelli, managing director of institutional sales trading at Robert W. Baird in Milwaukee.

Indeed, investors noted that strong corporate earnings have helped prop up U.S. stocks despite ongoing concerns about tariffs raising companies' costs and cutting into their profits.

Of the 148 S&P 500 companies that have reported earnings so far, 85.8 percent have topped analyst expectations. If the beat rate holds, it will be the highest on record, dating back to the first quarter of 1994, according to Thomson Reuters I/B/E/S.

"We've all been looking for the beginning of the bear market, but so far the commentary from companies has been pretty strong," said Kim Forrest, senior portfolio manager at Fort Pitt Capital Group in Pittsburgh.

The Dow Jones Industrial Average <.DJI> rose 172.16 points, or 0.68 percent, to 25,414.1, the S&P 500 <.SPX> gained 25.67 points, or 0.91 percent, to 2,846.07 and the Nasdaq Composite <.IXIC> added 91.47 points, or 1.17 percent, to 7,932.24.

Nasdaq futures, however, pared gains after the market close following Facebook's results.

Coca-Cola Co shares rose 1.8 percent after the beverage company's quarterly sales and profit beat estimates.

Shares of HCA Healthcare Inc jumped 9.2 percent after the hospital operator raised its full-year earnings forecast.

However, General Motors Co shares fell 4.6 percent after the automaker cut its 2018 profit forecast, citing rising steel and aluminium costs due to tariffs. After the bell, Ford Motor Co also lowered its profit forecast, and its shares dropped more than 4 percent in after-hours trading.

Shares of AT&T Inc fell 4.5 percent, weighing the most on the S&P, after the wireless carrier's quarterly revenue missed estimates.

Advancing issues outnumbered declining ones on the NYSE by a 1.84-to-1 ratio; on Nasdaq, a 1.31-to-1 ratio favoured advancers.

The S&P 500 posted 43 new 52-week highs and seven new lows; the Nasdaq Composite recorded 73 new highs and 83 new lows.

Volume on U.S. exchanges was 6.61 billion shares, compared to the 6.09 billion average for the full session over the last 20 trading days.

(Reporting by April Joyner; Additional reporting by Sinéad Carew in New York and Amy Caren Daniel in Bengaluru; Editing by Chizu Nomiyama)

This story has not been edited by Firstpost staff and is generated by auto-feed.

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