Technology, industrials and banks lead rally as stocks rise

Technology, industrials and banks lead rally as stocks rise
The Associated Press

NEW YORK (AP) — U.S. stocks are climbing Thursday as technology companies, banks and industrial companies rally. Big tech companies like Apple and Microsoft, the market’s leaders over the last year, are rising again as investors let go of some of their worries about trade tensions between the U.S. and China. Companies including Delta Air Lines and BlackRock are rising after they reported strong results in the first quarter.

KEEPING SCORE: The S&P 500 index gained 26 points, or 1 percent, to 2,669 as of 2:30 p.m. Eastern time. The Dow Jones industrial average added 350 points, or 1.5 percent, to 24,540. The Nasdaq composite climbed 81 points, or 1.2 percent, to 7,150. The Russell 2000 index of smaller-company stocks advanced 12 points, or 0.8 percent, to 1,559.

LEADERS: Apple rose 1.3 percent to $174.64 and Microsoft picked up 1.9 percent to $93.58 to lead the gains among technology companies, while Google’s parent company Alphabet gained 1.7 percent to $1,042.97. Technology companies have made big gains since the start of 2017 but have stumbled in recent weeks. Investors sold the stocks as they worried that the U.S.-China trade dispute might slow the global economy and make the stock’s high prices harder to justify.

In the industrial sector, Boeing rose 2.8 percent to $336.52 and Caterpillar added 2.7 percent to $150.715. Airlines also rose after Delta had a solid first quarter, as both passenger and cargo revenue improved. Delta stock rose 3.6 percent to $53.31, and other airlines including American and United Continental also climbed.

BONDS: Bond prices fell. The yield on the 10-year Treasury note rose to 2.83 percent from 2.79 percent. That helped banks because higher yields mean they can make more money from mortgages and other types of loans. JPMorgan Chase added 2.9 percent to $113.85 and U.S. Bancorp rose 1.5 percent to $51.30. Big dividend stocks like utilities and real estate investment trusts fell, as investors see them as an alternative to bonds and they are less interested in buying them when yields rise.

TRADE WINDS: The S&P 500, a benchmark that is used by many index funds, has fallen for three of the last four weeks as investors worried about trade tensions between the U.S. and China. It’s up 2.4 percent so far this week as investors felt new proposals by Chinese President Xi Jinping could help avert a trade war that would slow down global economic growth and corporate profits.

Xi said his government will reduce tariffs on imported cars, improve intellectual property protection and open China’s financial markets. On Thursday China’s government denied that Xi was trying to resolve the dispute and said negotiations with the U.S. aren’t possible right now, but investors sent stocks higher anyway.

EARNINGS: Companies are starting to report their first-quarter results. Investment firm BlackRock gained 2.1 percent to $536.32 after it surpassed Wall Street’s expectations at the start of the year.

Home goods retailer Bed, Bath & Beyond plunged after it gave a weak forecast for the fiscal year. The company also said it expects its earnings to decline next year and its stock fell 19.3 percent to $17.34. Retailer L Brands, the parent of Victoria’s Secret, lost 4.8 percent to $36.10 after it said discounts increased in March and profit margins decreased.

Their online rival Amazon gained 1.5 percent to $1,448.86.

COMMODITIES: Oil prices continued to trade at three-year highs. Benchmark U.S. crude rose 0.4 percent to $67.07 a barrel in New York. Brent crude, used to price international oils, shed 0.1 percent to $72.02 a barrel in London.

Precious metals prices tumbled. Gold dropped 1.3 percent to $1,341.90 an ounce and silver fell 1.8 percent to $16.47 an ounce. Copper lost 1.7 percent to $3.06 a pound.

Wholesale gasoline lost 0.6 percent to $2.05 a gallon. Heating oil dipped 0.4 percent to $2.08 a gallon. Natural gas rose 0.4 percent to $2.69 per 1,000 cubic feet.

DEAL DOUBTS: Bristol-Myers Squibb fell and Pfizer rose after an analyst for Citi Investment Research said a deal between the two drugmakers isn’t likely to happen. Analyst Andrew Baum said he met with Pfizer’s top executives Wednesday and that they have “no interest” in Bristol-Myers or other major deals right now. Bristol-Myers lost 2.2 percent to $58.84, giving it a market value of almost $96 billion. Pfizer rose 1.7 percent to $36.40.

MALLINCKRODT SINKING: Drugmaker Mallinckrodt dropped after a former employee filed a whistleblower lawsuit against the company. Rasvinder Dhaliwal said Mallinckrodt asked her to mislead an insurance company so it would cover Acthar gel, a drug that brings in more than one third of Mallinckrodt’s revenue, and said an executive acknowledged the company misled payers about what Acthar is made of.

The lawsuit says she had numerous other concerns about potentially illegal or improper behavior, but the company retaliated against her for bringing them up and ultimately fired her last month.

Mallinckrodt said it “vehemently disagrees with the allegations” and will defend itself in court. Its stock fell 8.2 percent to $13.68.

CURRENCIES: The dollar rose to 107.23 yen from 106.95 yen. The euro fell to $1.2331 from $1.2362.

OVERSEAS: The DAX in Germany rose 1 percent and France’s CAC 40 added 0.6 percent. The FTSE 100 in Britain rose less than 0.1 percent. Japan’s benchmark Nikkei 225 stock index dipped 0.1 percent while the Kospi in South Korea ended 0.1 percent lower. Hong Kong’s Hang Seng fell 0.2 percent.

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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

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