Stocks rebound on housing data, Trump trade deal remark
U.S. stocks finished broadly higher Wednesday after President Trump indicated that a deal to resolve the long-running, costly trade dispute with China could happen soon.
Trump’s remarks, in addition to a sharp increase in sales of new U.S. homes, helped reverse an early slide for stocks.
Technology companies led the rally, which snapped a three-day losing streak for the market. Communication services stocks and companies that rely on consumer spending also notched solid gains. Healthcare stocks were the biggest loser.
The Standard & Poor’s 500 index rose 18.27 points, or 0.6%, to 2,984.87. The Dow Jones industrial average gained 162.94 points, or 0.6%, to 26,970.71.
The Nasdaq climbed 83.76 points, or 1.1%, to 8,077.38. The Russell 2000 index of smaller companies picked up 17.07 points, or 1.1%, to 1,550.65.
The S&P 500, Dow and Nasdaq are on track to end the third quarter with modest gains.
Stocks got off to a downbeat start Wednesday as traders continued to weigh the implications of the House Democrats-led impeachment inquiry into Trump. The S&P 500’s losses began to ease after the Commerce Department said sales of newly built U.S. homes jumped 7.1% last month as lower interest rates helped drive sales. The report sent home builder shares broadly higher. KB Home gained 3%.
Chipmakers were among the big winners in the technology sector Wednesday. Nvidia climbed 3.3% and Qualcomm rose 2.7%. Apple, which does a lot of business in China and has much riding on the outcome of the trade war, gained 1.5%.
Citigroup rose 2.2% and Wells Fargo added 1.3% as financial sector stocks rose along with bond yields. The yield on the 10-year Treasury rose to 1.73% from 1.63% late Tuesday, a big move. The higher yields help banks charge more lucrative interest rates on loans.
Communication services stocks also helped lift the market out of its early malaise. Google parent Alphabet gained 2.3% and Netflix climbed 4%, recouping some of its losses from earlier in the week.
Boeing rose 1.2% as investors applauded the company’s move to form a new safety committee as it deals with the legal and financial fallout from two deadly 737 Max crashes. Uniform company Cintas climbed 5.7% after it reported a surprisingly good fiscal first-quarter profit and raised its forecast for profits and revenue.
Nike jumped 4.2% after a stellar earnings report and helped lift consumer-oriented companies. Tobacco company Philip Morris jumped 5.2% after calling off merger discussions with fellow tobacco giant Altria Group, which slid 0.4%.
Benchmark crude oil fell 80 cents to settle at $56.49 a barrel. Brent crude oil, the international standard, dropped 71 cents to close at $62.39 a barrel.
Gold fell $27.50 to $1,504.60 an ounce and silver fell 56 cents to $17.96 an ounce.
The dollar rose to 107.81 Japanese yen from 107.05 yen Tuesday. The euro weakened to $1.0942 from $1.1018.
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