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US: Stocks gain despite weak Adobe, Yum
[NEW YORK] Wall Street stocks pushed higher on Wednesday despite some disappointing earnings news from Yum Brands, Adobe Systems and others.
The Dow Jones industrial Average advanced 122.10 points (0.73 per cent) to 16,912.29.
The broad-based S&P 500 rose 15.91 (0.80 per cent) to 1,995.83, while the tech-rich Nasdaq Composite Index gained 42.79 (0.90 per cent) at 4,791.15.
Yum Brands, which owns the KFC and Taco Bell fast-food chains, plummeted 18.8 per cent as it lowered its earnings forecast due to sluggish sales in China.
Software company Adobe fell 5.3 per cent after projecting 2016 earnings of US$2.70 per share, well below the US$3.19 expected by analysts.
Analysts said US stocks were primed for gains after a terrible third quarter.
"Markets continue to see their bounce," said Charlie Bilello, director of research at Pension Partners. "We had an oversold market at the end of September." Pharma companies gained, including Dow member Merck (+2.3 per cent), Amgen (+4.8 per cent) and Celgene (+4.3 per cent).
Other big gains came from microblogging company Twitter (+8.0 per cent) and Chinese Internet giant Alibaba (+3.7 per cent).
Dow member General Electric rose 1.8 per cent as it announced it was reorganizing several energy management and research operations into a subsidiary specialising in new energy technologies.
Separately, Standard & Poor's shifted its ratings outlook to "negative." Beer and spirits distributor Constellation Brands gained 2.5 per cent as second-quarter net income rose 54.4 per cent to US$302.4 million.
Agricultural seed giant Monsanto rose 0.6 per cent as it announced plans to cut 2,600 jobs over the next 18 to 24 months due to weakening demand amid lower commodity prices.
Mining and oil company Freeport-McMoRan jumped 10.0 per cent after announcing an agreement with activist investor Carl Icahn to appoint two Icahn associates to the company's board.
Online radio service Pandora Media lost 4.6 per cent on news it will buy ticket seller Ticketfly for US$450 million.
Bond prices dipped. The yield on the 10-year US Treasury rose to 2.06 per cent from 2.04 per cent on Tuesday, while the 30-year advanced to 2.89 per cent from 2.87 per cent. Bond prices and yields move inversely.