US stocks extend gains to a 5th day as tech companies rise
By MARLEY JAY
May 24, 2017 12:58 PM
NEW YORK (AP) — U.S. stocks are up for the fifth consecutive day Wednesday as the market continues to wipe out the losses it suffered one week ago. Technology companies are rising, but energy companies are down with the price of oil. Banks and bond yields have weakened as the Federal Reserve gave more signs it will start reducing its huge portfolio of bonds later this year.
KEEPING SCORE: The Standard & Poor's 500 index picked up 4 points, or 0.2 percent, to 2,402 as of 2:20 p.m. The index is on track for a record close. The Dow Jones industrial average gained 65 points, or 0.3 percent, to 21,002. The Nasdaq composite rose 15 points, or 0.3 percent, to 6,153. The Russell 2000 index of small-company stocks held steady at 1,380.
TECH: Intuit, which makes software including TurboTax and QuickBooks, had a stronger quarter than investors expected and Wall Street was also pleased with its forecasts. Its stock gained $9.01, or 7 percent, to $138.16. Elsewhere hard drive maker Western Digital added $2.29, or 2.6 percent, to $90.32 and chipmaker Nvidia rose $1.82, or 1.3 percent, to $138.85.
THE FED: The Federal Reserve released the minutes from its meeting earlier this month. Officials discussed steps for shrinking the central bank's $4.5 trillion in bond holdings. The Fed bought huge amounts of bonds during the global economic crisis in an effort to stimulate the economy. When the Fed suggested in April that it was considering such a move, investors were jolted.
Bond prices rose. The yield on the 10-year Treasury note fell to 2.26 percent from 2.28 percent. Banks traded a bit lower as a result, as lower bond yields mean lower interest rates and reduced profits on lending. High-dividend companies including real estate investment trusts and utilities traded higher as investors looked for yield.
NOT SO ELECTRIC: General Electric slumped after CEO Jeffrey Immelt addressed an industry conference. Immelt suggested it will be tough for the company to reach the earnings targets some investors want to see. The stock fell 51 cents, or 1.8 percent, to $27.77. GE, which is seen as a bellwether for many different industries, is trading at its lowest price in a year and a half.
LOWE'S SLOWS: Home improvement retailer Lowe's stumbled after investors were unimpressed by its profit and sales, as a hefty charge cut into its earnings in the first quarter. Lowe's shares fell $2.32, or 2.8 percent, to $80.02. Lowe's stock is flat over the last year while rival Home Depot has jumped 16 percent. Home Depot added 42 cents to $155.25 Wednesday.
MATERIAL WORLD: Makers of chemicals and other basic materials gained ground. Industrial gas company Praxair rose after it agreed to terms with Germany's Linde. The companies said they would combine in an all-stock deal in December. Praxair picked up $2.37, or 1.8 percent, to $132.34.
Dow Chemical and DuPont, which are also planning to combine, both rose 1 percent.
LOST ITS SHINE: Sales for jewelry retailer Tiffany weren't as good as expected in the first quarter. The company changed CEOs in February as it struggled with competition from online retailers and had difficulty attracting younger customers. Its stock dropped $7.62, or 8.2 percent, to $85.52 and competitor Signet fell $4.15, or 7.1 percent, to $54.23.
LID POPS OFF: Struggling retailer Container Store Group surged after it reported solid fourth-quarter results and its outlook for the year pleased investors. The company also said it will cut $20 million in spending and its stock gained $1.21, or 29 percent, to $5.36. Container Store traded above $40 a share in early 2014, shortly after the company's IPO, but it fell to under $4 earlier this month.
ENERGY: Benchmark U.S. crude lost 11 cents to settle at $51.36 per barrel in New York while Brent crude, used to price international oils, sank 23 cents to $53.92 a barrel in London. Oil prices have rallied lately as members of the OPEC cartel and other countries prepare to meet and discuss production. Those nations are expected to extend last year's production cut in a concerted attempt to prevent oil prices from falling.
METALS: Gold fell $2.40 to $1,253.10 an ounce. Silver lost 2 cents to $17.12 an ounce. Copper fell 1 cent to $2.58 a pound.
CURRENCY: The dollar rose to 111.85 yen from 111.76 yen. The euro edged up to $1.1188 from $1.1185.
OVERSEAS: The FTSE 100 index in Britain was up 0.3 percent and Germany's DAX fell 0.2 percent. The CAC 40 in France was 0.2 percent lower. The Hang Seng in Hong Kong finished unchanged after Moody's downgraded the Chinese government's credit rating. The firm said it expects China's financial strength to erode as debt rises, but its rating for the country is still relatively high. Tokyo's Nikkei 225 rose 0.7 percent. The Kospi in South Korea gained 0.2 percent.
AP Markets Writer Marley Jay can be reached at http://twitter.com/MarleyJayAP
His work can be found at https://apnews.com/search/marley%20jay
By MARLEY JAY
Updated: May 24, 2017 12:58 PM
Copyright 2017 The Associated Press. All rights reserved.