Wall Street ticks higher, but chip stocks tumble

By April Joyner NEW YORK (Reuters) - U.S. stocks edged higher on Wednesday as investors shrugged off lackluster quarterly reports from industrial bellwethers Boeing Co and Caterpillar Inc , though a lower-than-expected revenue outlook from Texas Instruments Inc sent chipmakers' shares lower

Reuters October 24, 2019 03:08:03 IST
Wall Street ticks higher, but chip stocks tumble

Wall Street ticks higher but chip stocks tumble

By April Joyner

NEW YORK (Reuters) - U.S. stocks edged higher on Wednesday as investors shrugged off lackluster quarterly reports from industrial bellwethers Boeing Co and Caterpillar Inc , though a lower-than-expected revenue outlook from Texas Instruments Inc sent chipmakers' shares lower.

Shares of Boeing and Caterpillar rose more than 1% despite significant earnings misses from both companies. Boeing reported a 53% drop in quarterly profit but reaffirmed the timeline for its grounded 737 MAX's return to service. Caterpillar's Asian sales tumbled, but the company said tariffs stemming from the U.S.-China trade war would have a smaller impact on its business than previously forecast.

With no new developments in trade relations, focus turned to earnings and other announcements from individual companies. Boeing and Caterpillar's shares were resilient, several analysts said, because the companies' slide in earnings was expected given the challenges they have faced throughout the year.

"Caterpillar has certainly been beset by trade war impact, so it wasn't necessarily all that surprising," said Shannon Saccocia, chief investment officer at Boston Private. "Boeing has had its own issues from the perspective of the 737 MAX."

Texas Instruments shares, however, tumbled 7.5% after the chipmaker projected fourth-quarter revenue below Wall Street estimates. The results sent shares of other semiconductor companies, including Intel Corp and Broadcom Inc , lower as well. The Philadelphia SE Semiconductor Index dropped 1.9%.

The Dow Jones Industrial Average <.DJI> rose 45.85 points, or 0.17%, to 26,833.95, the S&P 500 <.SPX> gained 8.53 points, or 0.28%, to 3,004.52 and the Nasdaq Composite <.IXIC> added 15.50 points, or 0.19%, to 8,119.79.

Advances in Apple Inc and Facebook Inc shares helped buoy the major indexes.

Apple shares rose 1.3% after Morgan Stanley said the iPhone maker's soon-to-be-launched video streaming service, Apple TV+, could boost its services revenue.

Facebook shares advanced 2.1% after Chief Executive Mark Zuckerberg sought to reassure U.S. lawmakers about the company's planned digital currency, Libra.

Nike Inc shares fell 3.4% after the sportswear company announced late on Tuesday that Mark Parker, its long-time CEO, would step down next year. Nike tapped John Donahoe, chief executive of ServiceNow Inc , as Parker's successor. ServiceNow shares fell 3.6%.

Shares of medical device maker Boston Scientific Corp and laboratory equipment maker Thermo Fisher Scientific Inc jumped after both companies reported strong results. Boston Scientific shares ended 5.0% higher and Thermo Fisher shares closed up 5.7%.

Eli Lilly and Co shares, however, fell 2.2% after the drugmaker missed third-quarter revenue estimates.

Advancing issues outnumbered declining ones on the NYSE by a 1.75-to-1 ratio; on Nasdaq, a 1.17-to-1 ratio favored advancers.

The S&P 500 posted 22 new 52-week highs and one new low; the Nasdaq Composite recorded 52 new highs and 61 new lows.

Volume on U.S. exchanges was 6.11 billion shares, compared to the 6.46 billion average for the full session over the last 20 trading days.

(Reporting by April Joyner; Additional reporting by Shreyashi Sanyal and Arjun Panchadar in Bengaluru; Editing by Tom Brown and Bill Berkrot)

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

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