Home News Finance News Wall Street stocks rose on Thursday after strong Chinese economic data

Wall Street stocks rose on Thursday after strong Chinese economic data

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Wall Street stocks rose on Thursday after stronger-than-expected daily currency fixing in China, alleviating fears of a worsening trade conflict. Thus, the broader index S&P 500 recorded its highest growth in two months, led by technology companies, erasing its loss for the week.

The blue-chip index Dow Jones Industrial Average added 371 points, or 1.4%, to 26,379 points. S&P 500 advanced by 1.9% to 2,938 points, while the technology Nasdaq Composite increased by more than 2% to a level of 8,039 points.

The CBOE Volatility Index, which measures the implied volatility of S&P 500 options, was down 13.24% to 16.91.

For the week so far, the S&P 500 has grown by 0.2%, while the Nasdaq has added 0.4%.

SP500 index

The yields on 10-year US Treasuries rose to 1.762%, and yields on 30-year bonds reached 2.288%. In Germany, yields on 10-year German sovereign bonds, the so-called Bunds, reached -0.5% after falling to a record low of -0.6% in the previous session.

The jump in bond yields coincided with the announcement that Germany plans to issue new debt to finance a pack of climate protection measures. Yesterday, sovereign bond yields declined worldwide as investors turned to safer assets because of concerns about the global economy.

Several reductions in interest rates from central banks around the world have heightened concerns about global economic growth. New Zealand, India, and Thailand have lowered interest rates, citing concerns about slowing growth.

Strong data on China’s economy helped to calm Wall Street. The Asian side said its exports grew by 3.3% year-on-year in July, while economists surveyed expected a fall of 2%.

Investors continue to monitor the movement of the yuan. The Chinese National Bank set the official reference rate for the Chinese currency at 7.0039 yuan for the dollar on Thursday, its lowest level since April 21, 2008.

Corporate stocks performance

The stocks of shared travel company Lyft gained 3% after raising its revenue forecasts for the current quarter and for the year due to better than expected earnings report. During the session, the growth reached even 7% but later returned in a correction.

The shares of Kraft Heinz dropped by more than 8.5% after the company disappointed with its first-half earnings and revenue, while the management lacked the confidence to predict future developments.

The stocks of Symantec gained 12.3%. They were supported by a Wall Street Journal article claiming that Broadcom chip maker could buy Symantec’s business with corporate customers after negotiations to buy the entire cybersecurity company failed. The deal could estimate the division at 10 billion USD. Broadcom shares reported a slight increase of 0.34%.

Advanced Micro Devices (AMD) gained 16.20% after introducing its new powerful EPYC data-center chip.

The stocks of Uber Technologies gained more than 8% during the session but collapsed in after-market trading. The company reported a 5.2 billion USD loss and a miss on revenue for the second quarter. Adjusted earnings of 4.72 USD per share were lower than the Investing.com estimate of a loss of 2.10 USD, and revenue was 3.17 billion USD, compared with the estimate of 3.31 billion USD.

The top performers on the S&P 500 were Advanced Micro Devices Inc (+16.20%), Symantec Corporation (+12.30%) and Albemarle Corp (+8.71%), while on the flipside were Kraft Heinz Co (-8.58%), CenturyLink Inc (-7.69%) and Perrigo Company PLC (-6.68%).

Corporate earnings reports

Uber lost 5.24 billion USD in the last three months, its largest-ever quarterly loss, news that sent the ride-hailing company’s shares sliding 10%. The company was reporting earnings for only the second time following its share sale in May. The latest losses were worse than analysts had expected and the company announced revenues that were also below predictions. Uber’s revenues rose by 14% to 3.17 billion USD in the second quarter, below analysts’ expectations of 3.3 billion USD and the smallest percentage on record. The company’s share price, which had climbed over 8% during the day, fell more than 10% in after-hours trading. Earlier, Uber’s chief executive, Dara Khosrowshahi, told that 2019 would be “our peak investment year and we think that 2020, 2021, you’ll see losses come down”. Uber’s huge losses have worried investors and the company’s shares have only closed above their initial public offering (IPO) price of 45 USD twice since its share sale.