Tech and industrial firms lead stocks back from losses
NEW YORK — North Korea’s latest missile launch jolted the U.S. stock market Tuesday, but major indexes pulled back from those early losses and mostly finished higher as the weakening dollar gave technology and industrial companies a boost.
Investors bought bonds, which are traditionally considered safe assets, after North Korea fired a midrange ballistic missile that crossed over northern Japan and fell into the Pacific Ocean. It’s believed to be the first time the country has sent a missile over Japan, and it seemed designed to show that North Korea can back up a threat to target the U.S. territory of Guam. Energy and insurance companies continued to feel the effects of Tropical Storm Harvey, which is dumping record amounts of rain on the Gulf Coast. The Dow Jones industrial average fell 134 points when the market opened.
And investors’ fears eased as the day went on. As the dollar declined to two-and-a-halfyear lows, companies that do a lot of business outside the U.S. climbed. A weaker dollar boosts their sales and helps their profits when they are converted back into dollars.
The Standard & Poor’s 500 index rose 2.06 points, or 0.1 percent, to 2,446.30. The Dow Jones industrial average gained 56.97 points, or 0.3 percent, 21,865.37. The Nasdaq composite added 18.87 points, or 0.3 percent, to 6,301.89. The Russell 2000 index of smaller-company stocks picked up 1.45 points, or 0.1 percent, to 1,383.68. Still, most of the stocks on the New York Stock Exchange fell.
The dollar has weakened in part because a lot of economies in other regions are getting stronger, which boosts their currencies. The dollar is down almost 10 percent in 2017, at its lowest point in more than a year and the euro is at two-year highs.
Defense contractors climbed. Raytheon advanced $3.87, or 2.2 percent, to $182.11. United Technologies and Rockwell Collins rose after the Wall Street Journal reported that the companies are close to a deal. United Technologies, which makes jet engines, elevators and other products, jumped $3.37, or 2.9 percent, to $118.70 and aviation electronics maker Rockwell Collins rose $2.75, or 2.1 percent, to $130.74.
The dollar rose to 109.71 yen from 109.09 while the euro rose to $1.1992 from $1.1979.
Bond prices rose. The yield on the 10-year Treasury note fell to 2.12 percent from 2.16 percent. Lower bond yields translate to lower interest rates, and banks fell as investors expected them to make less money from lending.
Benchmark U.S. crude gave up 13 cents to $46.44 a barrel in New York. Brent crude, the international standard, picked up 11 cents to $52 a barrel in London. The price of wholesale gasoline jumped another 6 cents, or 4.1 percent, to a two-year high of $1.78 a gallon.
Sporting goods companies tumbled again after Finish Line forecast weak second-quarter results and slashed its forecasts for the rest of the year. The retailer said discounts on shoes are growing, and its stock tumbled $1.92, or 18.4 percent, to $8.50.