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US close: Stocks mixed as earnings help offset China woes

By Josh White

Date: Friday 16 Aug 2019

US close: Stocks mixed as earnings help offset China woes

(Sharecast News) - Wall Street trading finished mixed on Thursday, after a strong set of results from Walmart and some positive economic data helped to offset worries over China vowing to counter the latest round of tariffs from the White House.
The Dow Jones Industrial Average rose 0.39% to close at 25,579.39 and the S&P 500 added 0.25% to 2,847.60, while the Nasdaq Composite slipped 0.09% to 7,766.62.

At the open, the Dow was 87.74 points after the index recorded its worst day of the year on Wednesday, driven by much weaker than expected economic data out of China and a report that Washington was not in fact easing back in its trade war with Beijing.

On Thursday morning, China's finance ministry said Washington's tariffs violated a consensus reached by the two countries' leaders at the 28 June G20 leaders' summit in Osaka, Japan.

Donald Trump said he had "no doubt" that Chinese President Xi Jinping could bring an end to the unrest by meeting face-to-face with the protesters.

The President tweeted: "If President Xi would meet directly and personally with the protesters, there would be a happy and enlightened ending to the Hong Kong problem. I have no doubt!"

Elsewhere, Hong Kong's government laid out plans for stimulus measures to help its struggling economy but also cut its growth forecast to flat for the rest of 2019, down from an already weak 0.5%.

Still on the macro front, efforts to defuse tensions with Tehran were disrupted on Thursday when the US applied to detain an Iranian tanker held in Gibraltar on suspicion of breaching international sanctions on oil shipments.

The vessel, the Grace 1, was carrying Iranian oil and seized by Royal Marines last month, after authorities alleged the cargo was destined for Syria in breach of an EU embargo.

Wednesday's massive sell-off on Wall Street was the result of a bond market phenomenon where the yield on the benchmark 10-year Treasury note breaks below that on the two-year note.

While far from perfect, a so-called 'inversion' of the yield curve had preceded every economic recession in US history.

The curve was still around the inversion point at the start of Thursday's session, even as the yield on the 30-year Treasury bond fell to a new record low.

On the data front, the number of Americans filing for unemployment benefits rose more than expected last week, according to figures released by the Labor Department on Thursday.

Jobless claims came in at 220,000, up 9,000 from the previous week's level, which was revised up by 2,000. Economists had been expecting a level of 214,000.

The four-week moving average came in at 213,750, up 1,000 from the previous week's average

Elsewhere, manufacturing activity in the US mid-Atlantic region held up better than anticipated in August, according to the results of one of the most closely-followed surveys of activity in the sector.

The Federal Reserve Bank of Philadelphia's manufacturing sector index slipped from a reading of 21.8 in July to 16.8 for August.

Heading east, manufacturing sector conditions in the Federal Reserve Bank of New York's jurisdiction picked up in August.

The so-called Empire State index rose from a reading of 4.3 for July to 4.8 in August, against consensus expectations for a reading of 2.2, and on the back of improving trends for new orders and shipments.

Meanwhile, the American consumer continued to splash out at a faster than expected clip over the summer.

According to the Department of Commerce, US retail sales volumes grew at a 0.7% month-on-month pace in August to reach $532.35bn.

Economists had forecast an increase of 0.2%, although the previous month's rise was marked down by a tenth of a percentage point to 0.3%.

Lastly, labour productivity in the States grew more quickly than expected during the second quarter, although so did unit labour costs.

And even more so taking into account the revisions carried out to the historical data, which pointed to stronger core inflation pressures going forwards, some economists said.

According to the Department of Labor, non-farm labour productivity in the US grew at a quarterly annualised pace of 2.3% over the three months to June, beating expectations for 1.4%, while unit labour costs rose by 2.4%, ahead of consensus forecasts for 1.8%.

In corporate news, Cisco shares were 8.61% lower after the technology giant stated future earnings would be weaker than expected on the back of a "significant impact" from the US-China trade war.

General Electric shares were 11.3% weaker after Bernie Madoff whistleblower Harry Markopolos said he had discovered "an Enronesque business approach" that has left the group "on the verge of insolvency".

Retailer Walmart's shares, on the other hand, were up 6.09% on the heels of its latest quarterly update.

Fellow retailers JC Penney and Williams-Sonoma were up 2.18% and 1.06%, respectively, after posting their earnings during the session, while chipmaker NVIDIA slipped 0.87% on the back of its numbers.

Dow Jones - Risers

Walmart Inc. (WMT) $112.69 6.11%
Boeing Co. (BA) $328.00 2.37%
Coca-Cola Co. (KO) $53.87 1.64%
Visa Inc. (V) $176.27 1.59%
Travelers Company Inc. (TRV) $145.61 1.45%
Procter & Gamble Co. (PG) $117.39 1.38%
Verizon Communications Inc. (VZ) $56.30 1.08%
McDonald's Corp. (MCD) $218.27 0.84%
Pfizer Inc. (PFE) $34.48 0.73%
International Business Machines Corp. (IBM) $131.90 0.51%

Dow Jones - Fallers

Cisco Systems Inc. (CSCO) $46.25 -8.61%
Walgreens Boots Alliance, Inc. (WBA) $49.29 -2.22%
Nike Inc. (NKE) $79.51 -1.88%
3M Co. (MMM) $156.87 -1.18%
Chevron Corp. (CVX) $116.95 -0.67%
Exxon Mobil Corp. (XOM) $67.25 -0.59%
Apple Inc. (AAPL) $201.74 -0.50%
United Technologies Corp. (UTX) $123.77 -0.46%
Intel Corp. (INTC) $45.70 -0.37%
Microsoft Corp. (MSFT) $133.68 -0.22%

S&P 500 - Risers

Walmart Inc. (WMT) $112.69 6.11%
Agilent Technologies Inc. (A) $69.57 6.10%
NetApp Inc. (NTAP) $46.47 3.94%
Brown Forman Corp. Class B (BF.B) $57.02 3.86%
Fidelity National Information Services Inc. (FIS) $134.94 3.26%
Kellogg Co. (K) $63.52 3.18%
Fiserv Inc. (FISV) $105.49 3.02%
Smith A O Corp. (AOS) $46.10 2.79%
Amer Water Works (AWK) $124.50 2.72%
Jack Henry & Associates Inc. (JKHY) $141.94 2.72%

S&P 500 - Fallers

Tapestry Inc. (TPR) $19.41 -22.23%
General Electric Co. (GE) $8.01 -11.30%
Cisco Systems Inc. (CSCO) $46.25 -8.61%
Gap Inc. (GPS) $15.36 -7.08%
CenturyLink Inc. (CTL) $10.57 -6.47%
Baker Hughes, A Ge Company Class A (BHGE) $20.70 -5.91%
Hanesbrands Inc. (HBI) $13.11 -5.89%
L Brands Inc (LB) $19.68 -5.61%
Coty Inc. Class A (COTY) $9.01 -5.56%
Best Buy Co. Inc. (BBY) $63.93 -4.54%

Nasdaq 100 - Risers

Fiserv Inc. (FISV) $105.49 3.02%
JD.com, Inc. (JD) $30.16 1.79%
Paypal Holdings Inc (PYPL) $104.95 1.63%
O'Reilly Automotive Inc. (ORLY) $375.43 1.62%
Facebook Inc. (FB) $182.59 1.60%
Charter Communications Inc. (CHTR) $380.94 1.54%
Monster Beverage Corp (MNST) $56.95 1.50%
Hologic Inc. (HOLX) $49.82 1.47%
Verisk Analytics Inc. (VRSK) $155.17 1.36%
Alexion Pharmaceuticals Inc. (ALXN) $109.04 1.29%

Nasdaq 100 - Fallers

Cisco Systems Inc. (CSCO) $46.25 -8.61%
NetEase Inc. Ads (NTES) $254.72 -2.83%
Autodesk Inc. (ADSK) $142.92 -2.72%
American Airlines Group (AAL) $25.41 -2.64%
Mylan Inc. (MYL) $17.61 -2.38%
Walgreens Boots Alliance, Inc. (WBA) $49.29 -2.22%
J.B. Hunt Transport Services Inc. (JBHT) $95.36 -2.19%
Tesla Inc (TSLA) $215.64 -1.81%
Kraft Heinz Co. (KHC) $25.06 -1.80%
Wynn Resorts Ltd. (WYNN) $102.50 -1.75%

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