The Business Times

US: Wall St jumps 1%, S&P ends above key level

Published Tue, Oct 28, 2014 · 10:28 PM

[NEW YORK] US stocks rose more than 1 per cent on Tuesday, with the S&P 500 ending above its 50-day moving average for the first time in almost a month as strong earnings eased concerns about the outlook for corporate America.

The gains were broad, with all 10 primary S&P 500 sectors up on the day. Energy stocks were the day's biggest gainers, up 2.2 per cent, while the Philadelphia SE Oil Service index gained 3.4 per cent.

Adding to the day's positive tone was consumer confidence data, which hit its highest since 2007 in October. The report overshadowed a separate read that showed new orders for capital goods by US businesses fell the most in eight months in September.

Amgen Inc climbed 6.1 per cent to US$157.19, among the top boosts for the S&P 500 and Nasdaq, a day after its 2015 outlook topped expectations. The Nasdaq Biotech index rose 1.3 per cent.

The majority of US companies reporting third-quarter results have beaten analysts' expectations so far, easing some worries about the impact of a stronger US dollar and weak global demand. "We haven't seen big global companies downgrade their outlooks because of the stronger dollar or anything else, so earnings coming in so strong has been a relief," said Channing Smith, co-portfolio manager of capital advisors growth fund at Capital Advisors in Tulsa, Oklahoma.

There have been some high-profile earnings disappointments. Twitter Inc fell 9.8 per cent to US$43.78 after it posted a slide in a closely watched measure of engagement, even as its user base grew in the third quarter.

The Dow Jones industrial average rose 187.81 points, or 1.12 per cent, to 17,005.75, the S&P 500 gained 23.42 points, or 1.19 per cent, to 1,985.05 and the Nasdaq Composite added 78.36 points, or 1.75 per cent, to 4,564.29.

With the day's advance, the S&P 500 ended above its 50-day moving average for the first time since Sept 29, a sign that momentum is turning more positive. The Russell 2000 jumped 2.7 per cent and traded above its 200-day moving average for the first time since Sept 19.

After the market closed, Facebook Inc posted revenue growth of almost 60 per cent. Shares were little changed in after-hours trading.

Investors were awaiting clues on the outlook for the US economy from the Federal Reserve as the central bank commenced a two-day policy meeting. It is likely to reinforce expectations it will wait a long while before rising interest rates, although the Fed is all but certain to announce the end of its massive bond-buying stimulus.

Advancing issues outnumbered declining ones on the NYSE by 2,582 to 501, for a 5.15-to-1 ratio on the upside; on the Nasdaq, 2,171 issues rose and 526 fell for a 4.13-to-1 ratio.

The benchmark S&P 500 index posted 64 new 52-week highs and 2 new lows; the Nasdaq Composite recorded 133 new highs and 36 new lows.

About 6.17 billion shares traded on all US platforms, according to BATS exchange data, below the month-to-date average of 7.92 billion.


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