Dow opens at record; Ap­ple earn­ings eyed

Kuwait Times - - BUSINESS -

US stock indexes kicked off the month on a strong note, with the Dow com­ing within spit­ting dis­tance of the 22,000 mark, pow­ered by gains in Gold­man Sachs and 3M.

The in­dex had pierced through the 21,000 mark five months ago and had breached the 20,000 mile­stone in Jan­uary. All eyes will be on the quar­terly per­for­mance of Dow-com­po­nent Ap­ple, which re­ports re­sults after the clos­ing bell. The iPhone maker’s shares were lit­tle changed.

Tech has been the best per­form­ing sec­tor this year, de­spite the sec­tor go­ing through bouts of volatil­ity of late on ris­ing val­u­a­tion con­cerns. The tech in­dex was up 0.27 per­cent in early trad­ing. In­vestors have been count­ing on earn­ings to sup­port high val­u­a­tions for eq­ui­ties. The S&P 500 is trad­ing at about 18 times earn­ings es­ti­mates for the next 12 months, above its longterm av­er­age of 15 times.

S&P 500 earn­ings are ex­pected on av­er­age to have grown 10.8 per­cent in the sec­ond quar­ter, ac­cord­ing to Thom­son Reuters I/B/E/S. “It’s been a very good earn­ings sea­son so far which is help­ing to sus­tain US stocks at record highs and off­set any dis­ap­point­ment with Don­ald Trump’s in­abil­ity to make progress on his growth poli­cies,” said Craig Er­lam, se­nior mar­ket an­a­lyst at online forex bro­ker Oanda.

The Dow hit a record clos­ing high on Mon­day, helped by Boe­ing, while sell­ing in tech­nol­ogy com­pa­nies kept the S&P 500 in check and pulled the Nas­daq lower.

At 9:40 am ET (1340 GMT), the Dow Jones In­dus­trial Av­er­age was up 61.02 points, or 0.28 per­cent, at 21,952.14 and the S&P 500 was up 4.19 points, or 0.16 per­cent, at 2,474.49. The Nas­daq Com­pos­ite was up 15.46 points, or 0.24 per­cent, at 6,363.58.

Ten of the 11 ma­jor S&P sec­tors were higher, with the fi­nan­cial in­dex’s 0.39 per­cent rise lead­ing the ad­vancers. Eco­nomic data showed US con­sumer spend­ing barely rose in June as in­come failed to in­crease for the first time in seven months. The core PCE num­bers - the Fed­eral Re­serve’s pre­ferred met­ric to gauge in­fla­tion - for June edged up 0.1 per­cent fol­low­ing a sim­i­lar in­crease in May. In the 12 months through June, the so-called core PCE price in­dex in­creased 1.5 per­cent after ad­vanc­ing by the same mar­gin in May, re­main­ing be­low the Fed’s 2 per­cent tar­get rate.

Pfizer edged down 0.72 per­cent after the drug­maker’s quar­terly rev­enue missed ex­pec­ta­tions. Un­der Ar­mour fell 8.70 per­cent after the sports­wear maker cut its full-year sales fore­cast. Sprint jumped 8.26 per­cent after swing­ing to a quar­terly profit for the first time in three years. Lum­ber Liq­uida­tors soared 28.31 per­cent after the hard­wood floor­ing re­tailer re­ported its first quar­terly profit since a 2015 scan­dal re­lated to al­le­ga­tions of car­cino­gens in its prod­ucts dented sales. World stocks, on their long­est streak of monthly gains in more than a decade, rose on Tues­day amid fur­ther signs that the global econ­omy is in fine fet­tle, while the beaten-down dol­lar edged up slightly from 14-month lows. — Reuters

—AP

NEW YORK: In this Oct 25, 2016 file photo, a minia­ture re­pro­duc­tion of Ar­turo Di Mod­ica’s “Charg­ing Bull” sculp­ture sits on dis­play at a street ven­dor’s ta­ble out­side the New York Stock Ex­change, in lower Man­hat­tan.

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