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S&P 500 approaches record high on U.S.-China trade progress

Published 10/25/2019, 03:10 PM
S&P 500 approaches record high on U.S.-China trade progress
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By April Joyner

NEW YORK (Reuters) - The S&P 500 rose on Friday, briefly surpassing its record closing high, after Washington said it was close to finalizing parts of a trade pact with Beijing.

The benchmark index (SPX) hit a session high of 3,027.39, reaching above its closing record of 3,025.86 on July 26. It came within a point of overtaking its all-time high of 3,027.98 set during the July 26 session.

U.S. stocks added to marginal gains early in the session after the U.S. Trade Representative's office said that deputy-level trade talks would continue. President Donald Trump also struck a hopeful tone, saying that China wanted "to make a deal very badly."

The developments rounded off a strong week for equity markets, which were boosted by a clutch of better-than-expected third-quarter earnings reports. The S&P 500 and the Nasdaq were both set for their biggest weekly percentage gain in seven weeks.

Intel Corp's (O:INTC) quarterly report added to Friday's upbeat sentiment. The chipmaker's shares jumped 7.6%, on track for their largest daily percentage gain since January 2018, after the company beat Wall Street revenue and profit estimates and raised its full-year revenue forecast.

The gain in Intel shares helped propel the Philadelphia SE Semiconductor index (SOX) to a record high.

Trade optimism and Intel's gains outweighed losses in shares of Amazon.com Inc (O:AMZN), which fell after the e-commerce giant forecast revenue and profit for the crucial holiday quarter below estimates. Amazon shares were last down 1.7%, off their session low.

"The market reaction to Amazon wasn't as bad as people thought, which created a positive atmosphere," said Michael O'Rourke, chief market strategist at JonesTrading in Greenwich, Connecticut. "Then the trade headlines - I think the market liked that as well."

The Dow Jones Industrial Average (DJI) rose 149.4 points, or 0.56%, to 26,954.93, the S&P 500 (SPX) gained 10.93 points, or 0.36%, to 3,021.22 and the Nasdaq Composite (IXIC) added 46.16 points, or 0.56%, to 8,231.96.

Boeing Co (N:BA) shares dropped 1.5% after Indonesian authorities looking into October 2018's Lion Air crash said the world's largest planemaker failed to grasp risks in the design of cockpit software on its 737 MAX jet.

Shares of VF Corp (N:VFC) fell 6.7% after the apparel maker reported lower-than-expected quarterly revenue as its popular Vans and Timberland brands faced intensified competition.

Charter Communications Inc (O:CHTR) shares gained 6.9%. The cable operator posted better-than-expected quarterly results, fueled by customer growth in its broadband services business.

The next round of earnings due next week includes Apple Inc (O:AAPL), Alphabet Inc (O:GOOGL), Pfizer Inc (N:PFE) and Merck & Co Inc (N:MRK).

Advancing issues outnumbered declining ones on the NYSE by a 1.43-to-1 ratio; on Nasdaq, a 1.74-to-1 ratio favored advancers.

The S&P 500 posted 40 new 52-week highs and three new lows; the Nasdaq Composite recorded 80 new highs and 55 new lows.

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