Banks, communications companies lead stocks higher at midday
NEW YORK (AP) — U.S. stocks edged higher in midday trading Friday as solid earnings from banks helped extend momentum from the previous day's rally.
State Street and Citizens Financial were among the latest banks to report encouraging results in a week of solid reports from larger financial institutions. Investors were also digesting the latest government housing data which showed a December surge in new home construction.
The latest bright sign on the economy follows Thursday’s solid retail sales report, which revealed consumers are still spending at a healthy pace.
Technology stocks also made big gains in the early going. Qualcomm rose 4.1%.
Communications companies rose. Google parent company Alphabet climbed again, a day after becoming the latest tech giant to cross the $1 trillion valuation mark, joining Apple and Microsoft. Comcast rose 1.3% after its NBCUniversal unit launched a video streaming service, Peacock.
Bond prices fell, pushing yields higher. The yield on the 10-year Treasury rose to 1.83% from 1.8% late Thursday.
Safe-play sectors, including utilities and real estate companies, lagged the market.
Stocks are still trading around their latest record highs reached a day earlier and are on track for solid weekly gains. The two days of good economic news come on the heels of the U.S. and China signing an initial trade deal. Progress on trade has eased fears on Wall Street about the potential for the dispute to escalate further.
KEEPING SCORE: The S&P 500 index rose 0.2% as of 11:45 a.m. Eastern time. The Dow Jones Industrial Average rose 32 points, or 0.1%, to 29,329. The Nasdaq rose slightly. The Russell 2000 index of smaller company stocks fell 0.1%. Markets in Europe and Asia rose.
NEW YEAR UNDERWAY: Financial markets are solidly higher just a few weeks into 2020 as trade disputes quiet down and the economic picture remains bright.
The S&P 500 is up 2.7% so far this year and technology stocks are once again leading the gains. The index finished 2019 with a sharp 28.9% gain on a surge from the technology sector.
The recent signing of a “Phase 1” deal has raised hopes on Wall Street that China and the U.S. will avoid any further escalations as they continue talking. U.S. election concerns and the ongoing impeachment of President Donald Trump have been both largely ignored by Wall Street so far.
HEAVY ANCHOR: Gap fell 1.2% after the retailer cancelled plans to spin off its Old Navy brand, saying the move would be too costly. It also said the president and CEO of the Gap brand, Neil Fiske, is stepping down.
SHIPPING BLUES: Major shipping companies struggled in the fourth quarter because of costs and restrictions tied to the ongoing U.S.-China trade war and slower global economic growth.
Expeditors International of Washington fell 4.7% after the company warned investors about a weak fourth quarter. JB Hunt Transport Services fell 4.3% after reporting disappointing fourth-quarter profits.