Tags: Financial Markets

Gains for AT&T and Boeing Help Lift US Stock Indexes Higher

Wednesday, 26 July 2017 04:33 PM

U.S. stocks edged further into record territory Wednesday. Boeing and AT&T rose sharply after posting strong second-quarter results. Energy companies rose with the price of oil. Treasury yields took a step backward after the Federal Reserve held short-term interest rates steady.

KEEPING SCORE: The Standard & Poor's 500 index ticked up by 1 point, or less than 0.1 percent, to 2,478, as of 2:20 p.m. Eastern time. It closed at a record Tuesday, as did several other major stock indexes.

The Dow Jones industrial average gained 99 points, or 0.5 percent, to 21,713, and the Nasdaq composite rose 8 points, or 0.1 percent, to 6,420.

The Russell 2000 index of smaller-company stocks dipped 5 points, or 0.3 percent, to 1,446. Slightly more stocks rose than fell on the New York Stock Exchange.

LIFTOFF: Boeing's stock was on pace for its best day in more than seven years after it raised its forecast for earnings this year and reported better-than-expected earnings for the second quarter. It rose $18.86, or 8.9 percent, to $231.35. The aerospace and defense giant was responsible for all of the gains in the 30-stock Dow Jones industrial average, and its stock is now the highest-priced on the index.

PICKUP: AT&T is on track for its biggest gain in eight years. It jumped $1.72, or 4.7 percent, to $37.94 after reporting stronger second-quarter profit than Wall Street had forecast. The phone and video company also said it is on track to complete its purchase of Time Warner before the end of the year. That would further diversify AT&T's business as competition in the wireless industry gets more intense.

Time Warner picked up $1.59, or 1.6 percent, to $101.40.

Verizon also rose 52 cents, or 1.2 percent, to $44.50 as phone companies did far better than the broader market.

HEALTH WOES: Health care stocks moved lower as investors were mostly disappointed with reports or forecasts from biotechnology company Amgen, drug and medical device maker Baxter International, and scientific instrument and laboratory equipment maker Thermo Fisher. Amgen shed $5.26, or 2.9 percent, to $175.63. Baxter fell 93 cents, or 1.5 percent, to $61.16. Thermo Fisher sank $6.71, or 3.7 percent, to $173.42.

Hospital operator Universal Health Services dropped $9.44, or 7.7 percent, to $113.46 as it cut its outlook in the wake of a weak second quarter.

CHIPS ON TOP: Advanced Micro Devices soared after it raised its forecast for full-year revenue growth and reported stronger-than-expected results for the second quarter. It jumped 76 cents, or 5.4 percent, to $14.87.

LOOKING AHEAD: Akamai Technologies fell to the sharpest loss in the S&P 500 despite reporting better-than-expected second-quarter results. It gave a forecast for third-quarter revenue and other measures that were lower than analysts were expecting. The cloud services company fell $7.63, or 14.3 percent, to $45.65.

FED IN FOCUS: The Federal Reserve wrapped up its two-day meeting on interest-rate policy by leaving short-term rates unchanged. It had already raised rates three times since December.

The central banks said it still sees further "gradual" hikes, and economists expect it to resume either later this year or in 2018.

Perhaps more important is what the Fed does with the massive $4.5 trillion balance sheet it built after hoovering up bonds following the financial crisis. The Fed said in its statement that it would begin shrinking the portfolio "relatively soon." Analysts say that may start happening as soon as September.

Some investors worry that markets are due to shake out of their unusually calm pattern as the Fed further raises rates and trims its balance sheet.

YIELDS: The yield on the 10-year Treasury note slid to 2.29 percent from 2.33 percent. The two-year yield dipped to 1.36 percent from 1.39 percent, and the 30-year yield fell to 2.90 percent from 2.92 percent.

MARKETS ABROAD: Japan's benchmark Nikkei 225 index climbed 0.5 percent, South Korea's Kospi index slipped 0.2 percent and Hong Kong's Hang Seng index added 0.3 percent

France's CAC 40 rose 0.6 percent, the FTSE 100 in London gained 0.2 percent and Germany's DAX rose 0.3 percent.

COMMODITIES: The price of oil kept climbing after the U.S. government said crude oil and gasoline stockpiles continued to shrink last week. Benchmark U.S. crude topped $48 per barrel for the first time in seven weeks. It climbed 86 cents, or 1.8 percent, to $48.75 per barrel. Brent crude, the international standard, gained 77 cents to $50.97 per barrel.

Natural gas fell 2 cents to $2.92 per 1,000 cubic feet. Wholesale gasoline rose 2 cents to $1.62 a gallon and heating oil rose 3 cents to $1.60 a gallon.

Gold lost $2.70 to $1,249.40 an ounce. Silver fell 8 cents to $16.46 an ounce. Copper gained 3 cents to $2.87 a pound.

CURRENCIES: The dollar dipped to 111.50 Japanese yen from 111.89 yen late Tuesday. The euro rose to $1.1689 from $1.1652, and the British pound rose to $1.3086 from $1.3037.

AP Business Writer Kelvin Chan contributed from Hong Kong. AP Markets Writer Marley Jay contributed from New York.

© Copyright 2018 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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U.S. stocks edged further into record territory Wednesday. Boeing and AT&T rose sharply after posting strong second-quarter results. Energy companies rose with the price of oil. Treasury yields took a step backward after the Federal Reserve held short-term interest rates...
Financial Markets
Wednesday, 26 July 2017 04:33 PM
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