Upbeat earnings lift global stocks as trade fears damp dollar
Wall Street ends higher as strong company results offset trade fears
Stocks around the world advanced on Friday on strong earnings, with consumer staples results boosting Wall Street, though a trade spat between the United States and China along with weaker-than-expected US jobs numbers capped gains and weighed on the dollar.
US job growth slowed more than expected in July as employment in transportation and utilities fell, but analysts said the numbers didn’t change their expectations for a September rate hike. “With wages and salaries up 2.7 per cent, which is consistent with the 2.9 per cent annual increase we saw for private sector workers in the June employment cost index report released earlier last week, a third rate hike in September is all but certain,” said Heidi Learner, chief economist at Savills Studley in New York.
By the close, the Dow Jones Industrial Average has risen 136.42 points, or 0.54 per cent, to 25,462.58, the S&P 500 gained 13.13 points, or 0.46 per cent, to 2,840.35 and the Nasdaq Composite added 9.33 points, or 0.12 per cent, to 7,812.02.
The S&P consumer staples sector rose 1.2 per cent. Its advance was led by Kraft Heinz, up 8.6 per cent after the packaged foods company topped quarterly profit and revenue estimates.
For the week, the S&P 500 and Nasdaq posted gains, while the Dow was roughly flat.
MSCI’s gauge of stocks across the globe gained 0.35 per cent, while the pan-European FTSEurofirst 300 index rose 0.67 per cent.
Following news of China’s retaliatory tariffs and the US jobs data, yields on 7-year US Treasury notes led a fall in US government bond yields across maturities.
The US dollar slipped against the yuan after the Chinese central bank raised the forward reserve requirement for foreign exchange in a bid to stabilise its currency. The dollar was 0.52 per cent lower against the offshore yuan. The dollar index, which measures the greenback against a basket of six other currencies, was flat on the day at 95.148, after dipping as low as 94.98. The index was up 0.5 per cent for the week.