Wall Street markets ended the stock trading session on Tuesday, recovering some of the losses on Monday amid weakening investor concerns about renewed US-China trade tensions.
The blue-chip index Dow Jones Industrial Average posted a growth of more than 200 points, or 0.82%, to a level of 25,532.05 points, boosted by the appreciation of the shares of Visa and Boeing. This is also the best performance of the benchmark since April 12.
The broader S&P 500 added 0.8%, reaching 2,834.41 points. The technology index Nasdaq Composite advanced by 1.14% to 7,734.49 points.
Of the 11 major sectors of the S&P 500, all but utilities closed in the black. Technology stocks posted the largest percentage gains, climbing 1.6%.
The main reason for the recovery is the lack of fundamentals changes, as well as the continuing strong data from the US economy.
According to the analysts, the increase is “dead cat bounce” – a temporary reversal of the stock price after a significant decline caused by purchase to cover the positions.
The leading US indexes downgraded strongly on Monday after the Chinese authorities announced they planned to impose a counterweight tariffs on US imported goods for 60 billion USD in early June. Dow Jones and S&P 500 lost about 2.4% and Nasdaq 3.4%.
On the bonds market, the yields on 30-year and 10-year US Treasuries rose to 2.853% and 2.414%, respectively.
The CBOE Volatility Index, which measures the implied volatility of S&P 500 options, was down by 12.12% to 18.06.
Corporate stocks performance
The shares of Boeing and Caterpillar added 1.7%, while Apple appreciated by 1.6%.
The banking stocks also advanced, with Citigroup and Bank of America rising by 1.4% and 1.3% respectively, and J.P. Morgan Chase expanded by 0.8%.
In the technology sector, the shares of Microsoft added 1.12% and Cisco Systems increased by 1.4%.
Coca-Cola’s stock rose by 1.33%.
Walt Disney Co announced it would take control of Comcast Corp’s Hulu in a move to challenge Netflix and others in the global video streaming war. Disney stock climbed 1.4%, while Comcast gained 1.5%. Netflix edged up 0.1%.
Shares of Ralph Lauren Corp fell by 1.1% even after the clothing retailer’s earnings and revenues beat Wall Street expectations.
Uber Technologies and ride-hailing rival Lyft Inc reversed course after their post-debut slides. Their stocks advanced 7.7% and 4.9%, respectively. Uber’s shares rose another 6.4% in after-the-bell trading after a U.S. labor agency said it had concluded that the company’s drivers were independent contractors, not employees.
Shares in Bison Capital Acquisition Corp fell to all-time lows, falling 54.95%, while the shares in Solid Biosciences LLC fell to by 28.59%.
The top performers on the S&P 500 were Chesapeake Energy Corporation (+6.67%), CenturyLink Inc (+4.61%) and Electronic Arts Inc (+4.59%), while on the flipside were Ralph Lauren Corp Class A (-3.68%), Xylem Inc (-1.8%) and Church & Dwight Company Inc (-1.65%).
Corporate earnings reports
Ralph Lauren reported better-than-expected top- and bottom-line growth in its fourth quarter as global growth helped make up for declining sales in North America. Net income totaled 31.6 million USD, or 0.39 USD per share, in the quarter ended March 30, down from 41.3 million USD, or 0.50 USD per share, in the year-ago period. Adjusted EPS was 1.07 USD, easily topping analysts’ expectations. Revenue in the quarter fell by 1.5% to 1.51 billion USD, also beating Street estimates. Revenue for the full year increased to 6.31 billion USD. In North America, fourth-quarter revenue fell by 7% to 708 million USD, with wholesale revenue down 10% due to weakness in some spring fashions and planned reductions in off-price sales. North American total same-store sales fell 4%, with a 7% decline in stores and a 6% increase in e-commerce.
Operational profits (EBIT) of Thyssenkrupp declined by 66% to 145 million EUR (162.6 million USD) in the second quarter of the fiscal year 2019. A looming antitrust fine in the steel business had an additional negative impact on net profits. Thyssenkrupp recorded a net loss of 99 million EUR in Q2. According to the company, the decline in operational profits was attributable to higher material costs in Thyssenkrupp’s elevator segment as well as lower earnings in the company’s material and commodity segment. Thyssenkrupp’s steel business was hit by the historic low tide of the river Rhine as well as lower demand from the automotive industry. A new collective agreement would have had a negative impact on earnings, the German industrial company stated. Turnover of the German industrial giant increased by 2% to a total of around 20.4 billion EUR. According to Thyssenkrupp, the main growth driver for the company’s turnover had been its elevator business in the United States as well as in Europe.