Strong earnings from Wal-Mart, Cisco drive US stocks higher
Strong quarterly earnings from Wal-Mart Stores, Cisco Systems and other companies drove U.S. stocks higher in late-afternoon trading Thursday, placing the market on course to snap a two-day losing streak. Technology companies, health care stocks and consumer product makers accounted for some of the biggest gains. Energy and utilities stocks declined.
KEEPING SCORE: The Standard & Poor's 500 index rose 21 points, or 0.9 percent, to 2,586 as of 3:21 p.m. Eastern Time. The Dow Jones industrial average gained 194 points, or 0.8 percent, to 23,465. The Nasdaq composite index added 90 points, or 1.4 percent, to 6,797. The Russell 2000 index of smaller-company stocks picked up 22 points, or 1.5 percent, to 1,486. A day ago, stocks suffered their worst decline in two months.
THE QUOTE: "Investors have been looking to buy on weakness and they got a little bit of it," said Erik Davidson, chief investment officer for Wells Fargo Private Bank.
ONE STEP CLOSER: The House voted to pass a near $1.5 trillion package overhauling corporate and personal taxes Thursday. Now the focus goes to the Senate, where lawmakers are working on a different version of a tax reform bill. Both the House and Senate versions of the legislation would slash the 35 percent corporate tax rate to 20 percent and reduce some personal taxpayers' rates. But complaints by some GOP senators suggest challenges ahead for the White House and GOP to get a final measure that can make it through Congress over solid Democratic opposition.
Expectations of a big business tax cut have helped lift the market higher this year.
"To have a bit of positive news on tax reform is helpful, but there's still a long way to go with that," said Tom Martin, senior portfolio manager with Globalt Investments.
TECH RALLY: Technology sector stocks, which have done far better than the rest of the market this year, accounted for some of the biggest gains in early trading. Data storage company NetApp led the sector, vaulting 14.8 percent as investors applauded its quarterly results and forecasts. The stock rose $6.78 to $52.60.
IN HIGH GEAR: Cisco Systems leapt 6.2 percent, its biggest move since February 2016, after the internet gear maker reported a bigger profit than analysts expected and said revenue should grow in its next quarter after two years of declines. The stock added $2.12 to $36.23.
BIG RETAIL: Wal-Mart jumped 10.1 percent after the retail giant reported strong third-quarter results and raised its annual profit outlook. The company said online sales continued to surge and food sales were strong as well. Its shares posted their biggest gain since May 2016, rising $9.11 to $98.94.
BOARDROOM BLITZ: Procter & Gamble was up 1.3 percent after activist investor Nelson Peltz said an independent count showed he won election to the consumer products company's board. The shares gained $1.15 to $89.38.
EAT IT UP: J.M. Smucker climbed 9.8 percent after the food company served up a good second quarter and forecast slightly better sales for the full year. The company noted that higher prices for peanut butter and its Smucker brands helped boost results. The stock picked up $10.41 to $116.93.
COURTING TIME: Shares in Time soared 25 percent after The New York Times reported that Meredith Corp. will make another offer for the publisher. Time gained $3.17 to $15.83.
HOLIDAY DOWNER: Best Buy fell 3.8 percent after the electronics retailer's latest quarterly results and forecast for the holiday season fell short of estimates. Its shares slid $2.20 to $55.10.
BOND YIELDS: Bond prices fell. The yield on the 10-year Treasury note rose to 2.35 percent from 2.32 percent late Wednesday.
OIL: Crude oil prices fell. Benchmark U.S. crude slipped 19 cents to settle at $55.14 a barrel on the New York Mercantile Exchange. Brent crude, used to price international oils, slid 51 cents to $61.36 a barrel in London. Wholesale gasoline gave up 3 cents to $1.71 a gallon. Heating oil dipped a penny to $1.90 a gallon. Natural gas declined 3 cents to $3.05 per 1,000 cubic feet.
METALS: Gold edged up 50 cents to $1,278.20 an ounce. Silver added 10 cents to $17.07 an ounce. Copper shed 1 cent to $3.05 a pound.
CURRENCIES: The dollar strengthened to 112.98 yen from 112.89 yen on Wednesday. The euro weakened to $1.1765 from $1.1794.
MARKETS OVERSEAS: Major stock indexes in Europe closed higher. Germany's DAX gained 0.5 percent, while France's CAC 40 rose 0.7 percent. Britain's FTSE 100 added 0.2 percent. Earlier in Asia, Japan led the region higher as its benchmark Nikkei 225 snapped a six-day losing streak and jumped 1.5 percent. South Korea's Kospi added 0.7 percent. Hong Kong's Hang Seng index gained 0.6 percent. Australia's S&P/ASX 200 rose 0.2 percent.