NEW YORK, Oct 21 — Wall Street kicked off the week on an upbeat note today after the United States and China showed some signs of progress in resolving their trade war, but a fall in Boeing’s shares pressured the blue-chip Dow index.
White House adviser Larry Kudlow said that tariffs scheduled for December could be withdrawn if trade negotiations go well, adding to optimism from remarks by President Donald Trump that a trade deal could be signed by mid-November.
US chipmakers with a large exposure to China rose, with the Philadelphia Semiconductor index up 0.9 per cent. Trade-sensitive technology stocks also gained 0.3 per cent.
“Any kind of positive development on trade just gets people a little excited, although it is too optimistic to believe that they will reach a whole trade deal as early as mid-November,” said Robert Pavlik, chief investment strategist at SlateStone Wealth LLC in New York.
However, shares of Boeing Co were on track for their worst two-day fall in over a decade as multiple brokerages downgraded the stock after leaked messages from a former test pilot showed he might have unintentionally misled regulators about the safety of the grounded 737 MAX jet.
Shares of the planemaker slipped 4 per cent, also limiting gains on the S&P 500 index.
Wall Street has recovered after a rough start to the month on signs of progress in trade talks between the world’s two largest economies. The benchmark S&P 500 index ended Friday with its second weekly gain, while the Nasdaq rose for three weeks in a row.
At 10.11am ET the Dow Jones Industrial Average was up 14.99 points, or 0.06 per cent, at 26,785.19, the S&P 500 was up 11.88 points, or 0.40 per cent, at 2,998.08 and the Nasdaq Composite was up 34.69 points, or 0.43 per cent, at 8,124.23.
Investors are now gearing up for earnings reports this week from high-profile companies including Boeing, Microsoft, Procter & Gamble Co, United Parcel Service Inc and Caterpillar Inc.
Analysts have projected the first earnings contraction since 2016 for S&P 500 companies, but of the 75 companies that have reported results so far, only 12 per cent have come in below estimates, according to Refinitiv data.
Halliburton Co gained 6 per cent, reversing earlier losses, after the oilfield services provider detailed plans of further cost reductions on a conference call. The company reported a 32 per cent slump in third-quarter profit.
Coty Inc was the biggest gainer among S&P 500 companies after the cosmetics maker said it was planning to sell its professional beauty business that houses brands such as Wella and OPI.
Cardinal Health Inc, McKesson Corp and AmerisourceBergen Corp led declines on the benchmark index.
The drug distributors, along with Teva Pharmaceutical Industries, reached a settlement with two Ohio counties related to the opioid crisis.
Advancing issues outnumbered decliners by a 2.70-to-1 ratio on the NYSE and by a 2.21-to-1 ratio on the Nasdaq.
The S&P index recorded 32 new 52-week highs and two new lows, while the Nasdaq recorded 66 new highs and 30 new lows. — Reuters