NEW YORK, Feb 6 — US stocks rose yesterday as largely upbeat corporate results fuelled investor optimism ahead of the highly awaited State of the Union address by President Donald Trump.
Shares of Estée Lauder Cos Inc rose 11.6 per cent after the cosmetics maker’s quarterly results, driven by strong growth in China, topped estimates. Estée Lauder shares had the largest percentage gain among S&P 500 companies.
Luxury fashion company Ralph Lauren Corp also reported better-than-expected sales and earnings, sending its shares 8.4 per cent higher.
Shares of Alphabet Inc reversed course to end 0.9 per cent higher. The Google parent company’s results beat estimates, but its shares were dragged down earlier in the session by sharply higher spending.
Optimism toward the prospect of a lasting resolution to the dispute over border wall funding, which prompted a record 35-day partial US government shutdown, also buoyed Wall Street, said Tony Roth, chief investment officer of Wilmington Trust in Wilmington, Delaware.
In his State of the Union speech, scheduled for 09.00pm EST (10am Wednesday, Malaysia Time), Trump is expected to urge a congressional committee to work out a border security deal. His speech likely will target areas for potential bipartisan agreement, such as improving infrastructure and lowering prescription drug costs.
“The market doesn’t care if the wall gets built or if it’s never built,” Roth said. “All it cares about is that confidence and GDP aren’t negatively impacted as a result of a government shutdown.”
The Dow Jones Industrial Average rose 172.15 points, or 0.68 per cent, to 25,411.52, the S&P 500 gained 12.83 points, or 0.47 per cent, to 2,737.7 and the Nasdaq Composite added 54.55 points, or 0.74 per cent, to 7,402.08.
The CBOE Volatility index, often referred to as an investor fear gauge, dropped 0.16 point to finish at 15.57, its lowest close in four months.
Following a turbulent end to 2018, US stocks have had a stellar run so far this year, with the S&P 500 and the Dow each up about 9 per cent and the Nasdaq rising more than 11 per cent.
In addition to corporate earnings, Wall Street’s rally this year has been helped by a recent dovish stance from the Federal Reserve and hopes of a trade deal between the United States and China.
Among other stocks, Boeing Co shares rose 3.3 per cent after the aerospace company said it made a significant investment in supersonic business jet developer Aerion.
Shares of Archer Daniels Midland Co slumped 5.9 per cent after the grains trader’s fourth-quarter profit missed expectations because of the US-China trade dispute.
Advancing issues outnumbered declining ones on the NYSE by a 2.01-to-1 ratio; on Nasdaq, a 1.31-to-1 ratio favoured advancers.
The S&P 500 posted 21 new 52-week highs and no new lows; the Nasdaq Composite recorded 62 new highs and 14 new lows.
Volume on US exchanges was 6.97 billion shares, compared with the 7.56 billion average over the last 20 trading days. — Reuters