The Morning Journal (Lorain, OH)
Tech companies lead U.S. stock rally
A strong performance by tech stocks and signs of progress in the trade dispute powered the market.
A strong performance by technology stocks and signs of progress in the trade dispute between the U.S. and the European Union powered the market to its third consecutive gain Wednesday. The Nasdaq composite closed at an all-time high.
The major stock indexes jumped in the last half-hour of trading amid reports that a meeting between President Donald Trump and an EU delegation had yielded an agreement to work on averting a budding dispute between the two trading partners.
Health care and industrial stocks also posted solid gains. Phone companies and other highdividend, safe-play stocks lagged the broader market. Homebuilders slumped on government data showing sales of new U.S. homes fell in June. Prior to the developments out of Washington, stocks had held on to modest gains for most of the day as investors drew encouragement from the latest batch of quarterly earnings results.
“Tariffs haven’t had an enormous impact on earnings, particularly in the manufacturing sector,” said Jeramey Lynch, global investment specialist at J.P. Morgan Private Bank. “We haven’t seen that so far. Earnings have still been strong because the potential impacts so far of tariffs are being more than offset by what we see as a very favorable macroeconomic backdrop.”
The S&P 500 index notched its best day in more than a month, climbing 25.67 points, or 0.9 percent, to 2,846.07. The Dow Jones Industrial Average surged 172.16 points, or 0.7 percent, to 25,414.10. The Nasdaq added 91.47 points, or 1.2 percent, to 7,932.24. The Russell 2000 index of smaller-company stocks followed up its worst day in a month with a gain of 5.01 points, or 0.3 percent, to 1,685.20.
The S&P 500, the market’s benchmark index, is on track for its fourth weekly gain in a row.
Investors have been focused this week on company earnings, which have mostly topped Wall Street’s expectations. At the same time, traders are still wary of global trade tensions, which have ratcheted up in recent weeks as the U.S. and some of its trading partners have imposed tariffs on certain products and threatened more.
That’s why news that the U.S. and the EU are working to mend their frayed trade relationship injected a wave of hopeful buying into the market.