Banks lead US stocks toward 4th straight gain
U.S. stocks are rising again Tuesday as strong company earnings lift the market. The benchmark S&P 500 index is up for the fourth day in a row and fifth out of the last six. Banks and energy and industrial companies are making some of the largest gains.
KEEPING SCORE: The S&P 500 index rose 8 points, or 0.3 percent, to 2,858 at closing time. The Dow Jones Industrial Average jumped 127 points, or 0.5 percent, to 25,630. The Nasdaq composite gained 24 points, or 0.3 percent, to 7,884. The Russell 2000 index of smaller-company stocks edged up 4 points, or 0.3 percent, to 1,688.
The S&P 500 is trading at its highest levels since Jan. 26, when it closed at its most recent all-time high. After that peak, it dropped 10 percent in nine days as investors worried about signs that inflation was accelerating. That hasn’t materialized, but trade fears have weighed on the market since then.
THE QUOTE: Gina Martin Adams, chief equity strategist for Bloomberg Intelligence, said companies are reporting huge profit and revenue growth. That’s nudged the trade issue out of investors’ minds.
“Very strong top line and bottom line growth from the vast majority of companies overwhelmed any fears that started to bubble up in June,” she said.
She added that the tariffs that the U.S. and its trading partners have announced recently are still small and haven’t affected the broader market very much.
HAPPY DAY AT HERTZ: Rental car company Hertz soared 22.9 percent to $19.24, but even with that huge gain, the stock is still down 13 percent for the year.
A little more than four years ago, the stock traded above $120 a share. Hertz plunged as the company dealt with overcapacity in the rental car market and as the value of its vehicles decreased. Hertz has changed CEOs twice in four years.
OFF TO THE RACES: Arts and crafts marketplace Etsy surged 4.8 percent to $44.46 after it reported stronger sales than analysts anticipated and raised its forecasts for the year. Fertilizer maker Mosaic also raised its expectations and jumped 6.1 percent to $31.94.
Banks and financial companies climbed. Charles Schwab rose 0.9 percent to $50.86 and Berkshire Hathaway built on Monday’s rally by adding 1.5 percent to $209.08.
ENERGY: U.S. crude oil picked up 0.2 percent to $69.17 a barrel in New York. Brent crude, the standard for international oil prices, rose 1.2 percent to $74.65 a barrel in London.
Wholesale gasoline added 1.9 percent to $2.10 a gallon. Heating oil rose 1.4 percent to $2.17 a gallon. Natural gas gained 1.3 percent to $2.90 per 1,000 cubic feet.
Exxon Mobile climbed 1.6 percent to $81.45 and ConocoPhillips rose 1.9 percent to $73.12.
BIG CAVITY: Dental products maker Dentsply cut its forecasts and took a $1.26 billion charge connected to its technology and equipment business. The company said sales and profit margins have been weaker than expected and it plans to restructure its business. The stock dropped 18.8 percent to $39.35.
Online real estate marketplace Zillow cut its revenue forecast for the year and also said it’s buying Mortgage Lenders of America. Terms weren’t disclosed. The stock fell 14.3 percent to $49.86.
TWEET STORM: Tesla stock climbed after the Financial Times reported that Saudi Arabia’s sovereign wealth fund had invested in the company. It rose further after CEO Elon Musk tweeted that he might take the electric car maker private.
Musk, who owns about 20 percent of Tesla’s stock, said he would pay $420 a share, well above Tesla’s all-time high from September. The stock gained 7.4 percent before trading was halted. The most recent price of $367.25 suggests most investors didn’t believe any deal was imminent.
WATCH IT DROP: Weight Watchers International sank 14.4 percent to $78.96. The weight loss company raised its forecasts for the year, but said it lost subscribers in the second quarter.
The stock has almost doubled in value this year and was worth about $12 per share in March 2017 when the company announced a deal with Oprah Winfrey to promote its products.
BONDS: Bond prices dipped. The yield on the 10-year Treasury note rose to 2.97 percent from 2.95 percent.
METALS: Gold was little changed at $1,218.30 an ounce. Silver edged up 0.2 percent to $15.37 an ounce. Copper rose 0.8 percent to $2.75 a pound.
CHINA INVESTMENT: A government newspaper said Beijing planned to issue policies to encourage investment amid concern about slowing economic growth and trade tensions. The China Daily said some state banks issued orders to local branches to lend more money.
CURRENCIES: The dollar rose to 111.43 yen from 111.40 yen. The euro rose to $1.1594 from $1.1556.
OVERSEAS: Germany’s DAX rose 0.4 percent and France’s CAC 40 advanced 0.9 percent. London’s FTSE 100 gained 0.7 percent.
The Japanese Nikkei 225 advanced 0.7 percent and Hong Kong’s Hang Seng added 1.5 percent. In South Korea, the Kospi rose 0.6 percent.
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