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Saturday 23 June 2018

Tech and retail firms rise edges US stocks higher

Apple and eBay rose for a third straight day.

Tech firms pushed higher (AP)
Tech firms pushed higher (AP)

By Marley Jay

US stocks have finished mostly higher as weeks of up-and-down trading, much of it related to trade tensions, gave way to smaller moves.

Technology companies, retailers, and US-focused companies kept rising while banks fell with interest rates.

The market spent the day alternating between small gains and losses. Technology companies like Apple and eBay rose for a third straight day and the Nasdaq composite again set an all-time high.

The US labour department said job openings increased in April, which could help lead to higher pay and greater consumer spending.

Retailers climbed, and smaller ones fared especially well following some strong first-quarter results. Larger companies like Amazon and Macy’s also rose.

However, banks fell along with interest rates and health care companies also traded lower. Starbucks fell after it said long-serving chairman Howard Schultz is leaving the company.

The S&P 500 added 1.93 points, or 0.1%, to 2,748.80. The Dow Jones industrial average slipped 13.71 points, or 0.1%, to 24,799.98. The Nasdaq composite rose 31.40 points, or 0.4%, to 7,637.86 and the Russell 2000 climbed 11.25 points, or 0.7%, to 1,664.63.

The Nasdaq, which includes a heavy weighting of technology companies, and the Russell, an index comprised of smaller and more US-focused companies, are at record highs. The S&P 500 is still 4% below the record it set on January 26, and the Dow will have to rally 7% to reach the mark it set the same day.

The labour department said that for the first time since records began in December 2000, there are more job openings than unemployed Americans. That could give workers more leverage for pay raises, while high levels of employment and greater consumer spending are expected to lead to faster economic growth in the coming months.

Retailers helped lead the way as more of them reported quarterly results. G-III Apparel Group climbed 10.8% to 47.53 dollars after it raised its annual profit and sales forecast following a strong first quarter. Ascena Retail shook off early losses and rose 7.9% to 3.95 dollars.

Amazon again finished at a record high after it jumped 1.9% to 1,696.35 dollars, while Target gained 2.8% to 78.50 dollars and Macy’s jumped 8% to 40.05 dollars.

Starbucks fell after Howard Schultz said he is stepping down as the coffee chain’s chairman. Mr Schultz has been chairman of the company since 2000 and oversaw enormous expansion for Starbucks over that time. He stepped away as CEO in 2000 but returned in 2008, and relinquished that title to Kevin Johnson in 2017. The stock lost 2.4% to 55.68 dollars.

S&P Dow Jones Indices said late on Monday that Twitter will be added to the benchmark S&P 500 index as of Thursday after Monsanto officially becomes part of Bayer. Twitter rose 5.1% to 39.80 dollars. Netflix, which will become part of the S&P 100 index, rose 1.1% to 365.80 dollars.

Bond prices rose. The yield on the 10-year Treasury note fell to 2.92% from 2.94%.

Financial companies fell in tandem with bond yields. Lower yields force interest rates down on mortgages and other kinds of loans, which means lower profits for banks. Morgan Stanley lost 1.5% to 50.78 dollars, and Capital One gave up 1.1% to 94.35 dollars.

Mylan climbed 3.8% to 39.98 dollars after federal regulators approved its version of Amgen’s anti-infection drug Neulasta. The Mylan drug, Fulphila, is called a biosimilar, meaning it is the generic equivalent of a complex biotech drug, and it is approved to reduce the risks of infections during treatment for cancer. Amgen lost 2% to 181.73 dollars.

Oil prices moved higher. Crude hit a three-year high of 72 dollars a barrel on May 21 but has declined sharply over the past two weeks. US crude picked up 1.2% to 65.52 dollars a barrel in New York. Brent crude, used to price international oils, added 0.1% to 75.38 dollars a barrel in London.

Press Association

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