Stock Indexes Move on First Trading Day of 2020
By ALEX VEIGA AP Business Writer
Stocks moved higher on Wall Street in early trading Thursday as U.S. markets reopened following the New Year’s Day holiday.
The latest gains, which have the major U.S. stock indexes on track for all-time highs, followed a rally in overseas markets after China’s central bank said it will free up more money for lending.
Investor sentiment has remained strong in recent weeks as the U.S. and China have taken steps to resolve some of their differences in their long-running trade dispute. Washington and Beijing announced last month that they reached an agreement over a “Phase 1” trade deal that calls for the U.S. to reduce tariffs and China to buy larger quantities of U.S. farm products.
Earlier this week, President Donald Trump tweeted that he will sign the initial trade deal with China at the White House next month. He also said he plans to travel to Beijing at a later date to open talks on other sticking points in the dispute that remain to be worked out, including Chinese practices the U.S. complains unfairly favor its own companies.
Technology companies accounted for a big slice of the market’s upward move Thursday. Western Digital climbed 4% and Advanced Micro Devices rose 6.4%.
Communication services and industrial stocks also notched solid gains. Facebook added 1.8% and General Electric rose 5.2%.
Retailers and restaurant chains helped lift the market. Amazon gained 2.5% and McDonald’s rose 1.2%.
Supermarket operators and household goods makers were among the biggest decliners. Kroger fell 1.4% and Kellogg lost 2.4%.
Utilities and real estate stocks also fell broadly. NRG Energy slid 2.8% and Kimco Realty dropped 5.4%.
KEEPING SCORE: The S&P 500 was up 0.5% as of 2:42 p.m. Eastern time. The Dow Jones Industrial Average climbed 220 points, or 0.8%, to 28,759. The Nasdaq composite gained 1%.
Smaller company stocks were lagging the broader market. The Russell 2000 index was down 0.7%.
The major indexes capped a blockbuster year Tuesday, with the S&P 500 and Nasdaq delivering their best annual performance since 2013.
CHARGED UP: Tesla rose 2.9% after a published report suggested the electric car maker will deliver its first China made Model 3 sedans as early as next week.
LET’S MAKE A DEAL: Anixter International climbed 3.2% after the supplier of communication and security products agreed to a higher buyout offer from private equity firm Clayton, Dubilier and Rice.
EXECUTIVE EXITS: Shares in Wingstop slumped 3% after the operator of chicken wing restaurants said its chief operating officer, Lawrence Kruguer, will resign as of March 7.
BOND YIELDS: Bond prices rose. The yield on the 10-year Treasury fell to 1.88% from 1.91% late Tuesday.
ENERGY: Oil prices edged higher, recovering from an early slide. Benchmark U.S. crude oil rose 6 cents to $61.12 a barrel. Brent crude, the international standard, was up 14 cents to $66.14 per barrel.
CHINA BANKING: China’s central bank said it will cut the amount of money banks will be required to have on hand from Jan. 6. The move is expected to boost the country’s slowing economy ahead of the Lunar New Year, which falls on Jan. 25. Companies and individuals typically need large amounts of cash on hand during China’s most important annual holiday to pay bonuses, clear debts and cover other expenses.
MARKETS OVERSEAS: Major indexes in Europe closed broadly higher. Germany’s DAX rose 1%, while France’s CAC 40 gained 1.1%. Britain’s FTSE 100 added 0.8%. In Asia, Hong Kong’s Hang Seng jumped 1.1% and South Korea’s Kospi lost 1.0%. Tokyo’s market was closed for the New Year’s Day holiday.
Copyright 2020 The Business Journal, Youngstown, Ohio.