logo
Plus   Neg
Share
Email

U.S. Stocks Extending Upward Trend On Disney Earnings, Stimulus Optimism

wallstreet nov02 05aug20 lt

Stocks have moved mostly higher in morning trading on Wednesday, extending the upward trend seen over the past few sessions. The Nasdaq has reached a new record intraday high, the S&P 500 has climbed to its best intraday level in over five months and the Dow has jumped to a nearly two-month intraday high.

Currently, the major averages are hovering near the best levels of the day. The Dow is up 254.06 points or 1 percent at 27,082.53, the Nasdaq is up 42.29 points or 0.4 percent at 10,983.45 and the S&P 500 is up 19.19 points or 0.6 percent at 3,325.70.

The notable advance by the Dow is partly due to a sharp increase by shares of Disney (DIS), with the entertainment giant spiking by 9.1 percent.

After the close of trading on Tuesday, Disney reported an unexpected adjusted fiscal third quarter profit despite weaker than expected revenues.

The continued strength in the broader markets may reflect optimism that lawmakers will eventually reach an agreement on a new coronavirus relief bill.

Democratic leaders said they continue to make progress toward an agreement after meeting with Trump administration officials on Tuesday.

"We're making progress," said Senate Minority Leader Chuck Schumer, D-N.Y. "We really went down issue by issue by issue, slogging through them,"

"They made some concessions, which we appreciated. We made some concessions, which they appreciated," he added. "We're still far away on a lot of the important issues, but we're continuing to go at it."

The comments from Schumer come after Senate Majority Leader Mitch McConnell, R-Ken., indicated he would support any agreement between Democrats and the White House.

Meanwhile, traders have largely shrugged off a report from payroll processor ADP showing a substantial slowdown in private sector job growth in the month of July.

ADP said private sector employment rose by 167,000 jobs in July after soaring by an upwardly revised 4.314 million jobs in June.

Economists had expected employment to surge up by another 1.5 million jobs compared to the 2.369 million job spike originally reported for the previous month.

Steel stocks have moved sharply higher in morning trading, driving the NYSE Arca Steel Index up by 3.4 percent to its best intraday level in nearly two months.

Substantial strength has also emerged among gold stocks, as reflected by the 3 percent spike by the NYSE Arca Gold Bugs Index. The index has jumped to a more than seven-year intraday high.

The rally by gold stocks comes as the price of the precious metal continues to soar, with gold for December delivery skyrocketing $36.50 to $2,057.50 an ounce.

Energy, chemical, and airline stocks are also seeing considerable strength, moving higher along with most of the other major sectors.

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Wednesday. Japan's Nikkei 225 Index fell by 0.3 percent, while China's Shanghai Composite Index edged up by 0.2 percent.

Meanwhile, the major European markets have all moved to the upside on the day. While the U.K.'s FTSE 100 Index has jumped by 1 percent, the French CAC 40 Index is up by 0.8 percent and the German DAX Index is up by 0.6 percent.

In the bond market, treasuries are giving back ground after ending the previous session notably higher. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 3 basis points at 0.545 percent.

For comments and feedback contact: editorial@rttnews.com

Follow RTT