The S&P 500 and Nasdaq hit record closing highs on Wednesday after reassuring comments from Texas Instruments about global chip demand blunted the impact of weak earnings reports from Boeing and Caterpillar.
The Dow Jones Industrial Average fell 81.44 points, or 0.3 per cent, to 27,267.75, the S&P 500 gained 13.97 points, or 0.46 per cent, to 3,019.44 and the Nasdaq Composite added 69.69 points, or 0.84 per cent, to 8,321.09.
Canada’s main stock index rose on Wednesday, despite losses in the energy and health care sectors.
The Toronto Stock Exchange’s S&P/TSX Composite index was rose 39.16 points, or 0.24 per cent, at 16,611.84.
Health care stocks fell 0.7 per cent as CannTrust Holdings Inc. dropped 21.9 per cent after a Globe and Mail report said that the company’s chairman and chief executive officer were informed in November of its unlicensed cannabis growing.
Energy stocks fell 1.2 per cent as oil prices fell 1 per cent, failing to draw lasting support from a large decrease in U.S. crude stockpiles as investors worried about global oil demand.
The materials sector, which includes precious metal miners, added 0.8 per cent as gold prices rose on expectations of monetary policy easing from leading central banks to shore up the global economy.
In New York, Texas Instruments Inc jumped 7.4 per cent after the company hinted that a global slowdown in microchip demand would not be as long as feared, powering the Philadelphia chip index up 3.1 per cent to a record high.
“Semiconductor investors are looking past right now and saying that maybe in the second half of this year, economic concerns will start to abate a little,” said Willie Delwiche, an investment strategist at Robert W. Baird in Milwaukee.
However, trade-sensitive Caterpillar Inc dropped 4.5 per cent following disappointing earnings on weak sales in China and higher production and restructuring costs.
Boeing Co fell 3.1 per cent after the world’s largest planemaker posted its largest-ever quarterly loss on the back of this year’s grounding of its best-selling 737 MAX after two deadly crashes.
Those two companies’ bleak reports left the Dow Jones Industrial Average in negative territory.
Two weeks into an earnings season with mute investor expectations, about 77 per cent of the 138 S&P 500 companies that have reported so far have topped earnings estimates, according to Refinitiv data.
Overall earnings per share, however, are now expected to fall 0.1 per cent, compared with a prior estimate of a rise of about 1 per cent.
Wall Street has hit record levels in July on bets the Federal Reserve will lower rates next week to counter the impact of a protracted U.S.-China trade war on economic growth.
The Dow Jones Industrial Average dipped 0.29 per cent to end at 27,269.97 points, while the S&P 500 gained 0.47 per cent to 3,019.56.
The Nasdaq Composite added 0.85 per cent to 8,321.50. The S&P 500 and Nasdaq each closed at their highest levels ever.
The Russell 2000 small cap index jumped 1.64 per cent to its highest close since early May. That suggests investors have grown more confident in the U.S. economy, Delwiche said.
For the year, the S&P 500 is now up 20 per cent, while the Nasdaq has gained 25 per cent.
In extended trade, Facebook jumped 4.3 per cent after the social network posted quarterly revenue above analysts average estimates.
Another bright spot on Wednesday was United Parcel Service Inc, up 8.7 per cent and among the biggest gainers on the S&P 500 index, after the world’s biggest package delivery company reported a better-than-expected quarterly profit.
Brent crude futures dropped 65 cents, or 1 per cent, to settle at $63.18 a barrel, while U.S. West Texas Intermediate (WTI) crude futures fell 89 cents, or 1.6 per cent, to settle at $55.88 a barrel.
Earlier in the session, the front-month Brent contract flipped to trade at a discount to the second-month contract, a market structure known as contango, for the first time since March. Sentiment in the oil market has darkened as investors worry that slowing global economic growth will weaken demand for oil.
On the supply side, OPEC members Saudi Arabia and Kuwait have discussed resuming oil production in jointly operated fields in the Saudi–Kuwaiti Neutral Zone, Kuwaiti state news agency KUNA said on Wednesday.
The two countries halted output from the oilfields - Khafji and Wafra - more than four years ago, cutting some 500,000 barrels per day, or 0.5 percent of global oil supply.
Oil prices initially rose after Energy Information Administration data on Wednesday showed a large drawdown in U.S. crude stockpiles. Crude inventories fell by 10.8 million barrels in the week to July 19. Analysts expected a decrease of 4 million barrels.
But the gains did not hold.
Reuters