The Wall Street’s blue-chip index Dow Jones Industrial Average and the broader S&P 500 ended the trading session on Thursday with increases, expecting more news about a possible trade deal between the US and China.
Dow Jones closed with 166.50 points up to 26,384.63 points. Boeing was best performing with reported stocks growth of nearly 3%.
The S&P 500 rose by 0.2% to 2,879.39 points, marking its first six-day positive series since February 2018. Since the beginning of 2019, the S&P 500 has so far increased by more than 14%.
The technology index Nasdaq Composite, however, ended the trading session with a minimum loss of 0.1% to 7,991.78 points after Tesla’s stock fell by 9%.
Volume on the Wall Street exchanges was 6.33 billion shares, compared with the 7.37 billion average for the full session over the last 20 trading days.
Trade talks between the US and China are in their final stage with the markets expecting a meeting between US President Donald Trump and Chinese Deputy Prime Minister Liu He. After the meeting, the US President Donald Trump said that Washington would know in four weeks whether a trade agreement with China could be reached.
“If we make a deal, there will be a meeting”, said the president, given his promise to meet his Chinese counterpart, Xi Jinping, in order to finalize a possible deal. “We will probably find out if there will be a deal within the next four weeks”, added he.
Donald Trump, in his speech, noted that the United States and China are very close to reaching an agreement to end the ongoing trade war between the world’s two largest economies in the last year.
Last week, US Trade Representative Robert Lighthizer and Finance Minister Steven Mnuchin held a new round of talks in Beijing, followed by a Chinese negotiator’s visit to Washington.
Corporate stocks performance
The stocks of the technology giant Facebook rose by 1.4% after Guggenheim changed the company’s rating from “Neutral” to “Buy”, citing “stable” consumer trends.
Boeing climbed 2.9%. Ethiopian investigators urged Boeing to review its flight control technology in the first public findings on the March crash of a 737 MAX jet. A Morgan Stanley analyst said the report potentially took the worst case scenario of an entirely new cause off the table.
Walt Disney and McDonald’s also led the upside. The latter has been challenging upside resistance near 190 since the fourth quarter of 2018. The Street continues to see modest profit growth for the world’s largest burger chain in the next two years (up 3% to 8.12 USD per share in 2019, up 8% in 2020).
The best performer of the session on the Dow Jones Industrial Average was Dow Inc (+4.98%), which split from DowDuPont, while Merck & Company and Walgreens Boots Alliance performed worst registering decreases of 1.6% and 1.26%, respectively.
Meanwhile, Tesla’s stock fell by 9% after its sales fell by 31% in the first quarter after the electric car manufacturer faced problems with the first delivery of the Model 3 sedan in Europe and China.
Corporate earnings reports
Constellation Brands posted stronger-than-expected fourth-quarter earnings due to selling its low-end wine brand portfolio for around 1.7 billion USD. The company said that comparable earnings for the three months ending in February, the company’s fiscal fourth quarter, came in at 1.84 USD per share, down by 3.15% from the same period last year but firmly ahead of the consensus forecast of 1.72 USD per share. Group sales rose by 2% to 1.797 billion USD, again beating analysts’ forecasts of 1.73 billion USD. Looking into the 2020 fiscal year, Constellation said its sees comparable earnings in the region of 8.50-8.80 USD per share, with operating income from its beer division rising between 7% and 9%. Wine and Spirits, however, will likely see net sales declines of around 25% to 30% with a larger decline in operating income of between 30% and 35%. Constellation is also gearing up to launch Corona Refresca — the brand’s first non-beer beverage — nationwide this month in a bid to attract health-conscious consumers, particularly women.