Stocks climb as economic data cheer investors
U. S. stocks rose Wednesday as investors cheered a report of stronger economic growth. Technology companies, retailers and travel providers made solid gains.
The Commerce Department raised its estimate for economic growth and said that in the April- throughJune quarter, U. S. gross domestic product grew at its fastest pace in two years. Healthcare companies and banks rose.
“The thing that’s kept the market af loat is the strong economic data,” said Brent Schutte, chief investment strategist at Northwestern Mutual Wealth Management. Schutte said that investors will be looking for evidence of higher pay and greater inf lation and that stocks should keep rising as long as the economy re- mains in good shape and inf lation doesn’t pick up.
The government raised its GDP projection from last month, and the secondquarter estimate is better than for the f irst quarter, when growth was 1.2%. Meanwhile, private businesses added 237,000 jobs in August, with broad gains across several industries, according to a survey by payroll processor ADP.
Analog Devices shares climbed 5.2% to $ 83.72 after the chip maker announced strong quarterly results and a better- than- expected revenue forecast.
AeroVironment soared 18.2% to $ 46.52 after the Monrovia drone maker said its product sales almost doubled last quarter.
Big names made some solid gains. Microsoft rose 1.3% to $ 74.01. Facebook ticked up 1.1% to $ 169.92. Amazon advanced 1.4% to $ 967.59 and Bank of America climbed 1.7% to $ 23.87.
Gasoline prices leaped to two- year highs, and oil prices fell further as the Gulf Coast region was inundated with rain by Tropical Storm Harvey, which has knocked out significant oil drilling and refining capacity.
Wholesale gasoline rose 5.7% to $ 1.88 a gallon. Benchmark U. S. crude fell 1% to $ 45.96 a barrel. Brent crude fell 2.2% to $ 50.86 a barrel.
The Food and Drug Administration approved the f irst treatment that genetically engineers patients’ own blood cells to seek and destroy childhood leukemia. The CAR- T drug, Kymriah, is made by Novartis, and several other f irms are working on similar treatments.
The approval didn’t surprise investors, and Novartis stock slipped 1.1% to $ 82.74. Gilead Sciences jumped 7.2% to $ 81.23, however. This week, Gilead agreed to buy CAR- T drug developer Kite Pharma for $ 11.9 billion. Juno Therapeutics, which is studying a similar treatment, slid 8% to $ 40.29.
Meanwhile, Otonomy plunged 82.8% to $ 3.58 after the San Diego company ended development on vertigo drug Otividex after it failed in a clinical trial.
Bond prices slipped after Tuesday’s big jump. The yield on the 10- year Treasury note rose to 2.14% from 2.13%.
Heating oil rose 1 cent to $ 1.67 a gallon. Natural gas fell 4 cents to $ 2.94 per 1,000 cubic feet.
Gold fell $ 4.80 to $ 1,314.10 an ounce. Silver fell 2 cents to $ 17.40 an ounce. Copper fell 2 cents to $ 3.06 a pound.
The dollar rose to 110.36 yen from 109.71 yen. The euro fell to $ 1.1890 from $ 1.1992.