Surging chip shares propel S&P 500 and Nasdaq to information

(Reuters) – The S&P 500 and Nasdaq hit report highs on Wednesday after reassuring feedback from Texas Devices about international chip demand blunted the affect of weak earnings stories from Boeing and Caterpillar.

Merchants work on the ground on the New York Inventory Alternate (NYSE) in New York, U.S., July 24, 2019. REUTERS/Brendan McDermid

Texas Devices Inc (TXN.O) jumped 7.4% after the corporate hinted {that a} international slowdown in microchip demand wouldn’t be so long as feared, powering the Philadelphia chip .SOX index up 3.1% to a report excessive.

“Semiconductor traders are trying previous proper now and saying that possibly within the second half of this yr, financial issues will begin to abate a bit of,” mentioned Willie Delwiche, an funding strategist at Robert W. Baird in Milwaukee.

Nonetheless, trade-sensitive Caterpillar Inc (CAT.N) dropped 4.5% following disappointing earnings on weak gross sales in China and better manufacturing and restructuring prices.

Boeing Co (BA.N) fell 3.1% after the world’s largest planemaker posted its largest-ever quarterly loss on the again of this yr’s grounding of its best-selling 737 MAX after two lethal crashes.

These two firms’ bleak stories left the Dow Jones Industrial Common in unfavourable territory.

Two weeks into an earnings season with mute investor expectations, about 77% of the 138 S&P 500 firms which have reported up to now have topped earnings estimates, based on Refinitiv knowledge.

General earnings per share, nonetheless, at the moment are anticipated to fall 0.1%, in contrast with a previous estimate of an increase of about 1%.

Wall Avenue has hit report ranges in July on bets the Federal Reserve will decrease charges subsequent week to counter the affect of a protracted U.S.-China commerce battle on financial development.

The Dow Jones Industrial Common .DJI dipped 0.29% to finish at 27,269.97 factors, whereas the S&P 500 .SPX gained 0.47% to three,019.56.

The Nasdaq Composite .IXIC added 0.85% to eight,321.50. The S&P 500 and Nasdaq every closed at their highest ranges ever.

The Russell 2000 small cap index jumped 1.64% to its highest shut since early Could. That implies traders have grown extra assured within the U.S. financial system, Delwiche mentioned.

For the yr, the S&P 500 is now up 20%, whereas the Nasdaq has gained 25%.

In prolonged commerce, Fb (FB.O) jumped 4.3% after the social community posted quarterly income above analysts common estimates.

One other vibrant spot on Wednesday was United Parcel Service Inc (UPS.N), up 8.7% and among the many largest gainers on the S&P 500 index, after the world’s largest package deal supply firm reported a better-than-expected quarterly revenue.

Advancing points outnumbered declining ones on the NYSE by a 2.69-to-1 ratio; on Nasdaq, a 2.45-to-1 ratio favored advancers.

The S&P 500 posted 35 new 52-week highs and no new lows; the Nasdaq Composite recorded 82 new highs and 94 new lows.

Quantity on U.S. exchanges was 6.2 billion shares, in contrast with the 6.Three billion common for the total session over the past 20 buying and selling days.

Reporting by Noel Randewich in San Francisco; Further reporting by Amy Caren Daniel and Karina Dsouza in Bengaluru; Enhancing by Lisa Shumaker and Tom Brown

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