The Denver Post

Stocks jump, trade worries take back seat

Bank stocks were also among the market’s biggest winners on Monday

- By Stan Choe

NEW YORK» Never mind the trade war. Here comes earnings season.

U.S. stocks climbed with other markets on Monday as concerns about trade tensions between the United States and the rest of the world took a back seat. The calendar for upcoming weeks is full of companies telling investors how much profit they made during the spring, and the expectatio­n is for another quarter of gangbuster­s growth.

That plus Friday’s report showing U.S. hiring remains strong have helped to support markets despite the world’s two largest economies imposing dueling tariffs on each other at the end of last week.

The S&P 500 rose 24.35 points, or 0.9 percent, to 2,784.17. The Dow Jones industrial average jumped 320.11, or 1.3 percent, to 24,776.59, and the Nasdaq composite gained 67.81, or 0.9 percent, to 7,756.20.

It’s the third straight day that the S&P 500 has climbed at least 0.8 percent. It follows a rocky few months where some investors sold stocks on the assumption that a full-blown, harmful trade war was a certainty. Others still expect negotiated settlement­s to be the final result.

“The market in the second quarter tried to price in this whole thing, and it was probably a little too fast for that,” said Matthew Miskin, market strategist with John Hancock Investment­s. “There still are a lot of negative developmen­ts happening here, but before earnings season typically tends to be a sweet spot for the market. “

Stocks often rise in anticipati­on of healthy earnings reports, Miskin said, and the results for this latest quarter are forecast to be much stronger than usual for companies this many years into an economic expansion.

Across the S&P 500, analysts are calling for 19 percent growth in earnings per share from a year earlier, according to S&P Global Market Intelligen­ce. Lower tax rates and stronger revenues are helping to drive the gains.

The growth may be peaking, however. Perhaps more important than the numbers for last quarter will be what CEOs say in conference calls about how much the trade tensions will hurt their profits later in the year.

Newspapers in English

Newspapers from United States