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Stock Market News For Aug 15, 2018

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Markets closed sharply higher on Tuesday, as the Turkish lira staged a rebound after hitting an all-time low. This saw bank stocks finally recovering after declining for two consecutive sessions. Also, robust earnings results lifted investors’ sentiments, which saw all three major indexes finishing in positive territory, with the S&P 500 finally ending its longest losing streak since March.

The Dow Jones Industrial Average (DJI) advanced 0.5%, to close at 25,299.92, ending its four-day losing streak. The S&P 500 gained 0.6% to close at 2,839.96, registering its strongest gain in three weeks. The Nasdaq Composite Index closed at 7,870.89, advancing 0.7%. A total of 5.89 billion shares were traded on Monday, lower than the last 20-session average of 6.43 billion shares. Advancers outnumbered decliners on the NYSE by a 2.55-to-1 ratio. On Nasdaq, a 1.74-to-1 ratio favored advancing issues.

How did the Benchmark Perform?

The Dow gained 112.22 points, snapping its four-day losing streak, as bank stocks rebounded. Shares of Morgan Stanley (MS - Free Report) , JPMorgan Chase & Co (JPM - Free Report) and The Goldman Sachs Group, Inc. (GS - Free Report) gained 1.1%, o.7% and 1.2%, respectively. Shares of Citigroup, Inc. (C - Free Report) gained 1.2%. JPMorgan has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The S&P 500 gained 18.03 points, ending its longest losing streak since March, and also posting its strongest gain in three weeks. Consumer Discretionary and financials were the biggest gainers. Both the Consumer Discretionary Select Sector SPDR (XLY) and Financial Select Sector SPDR (XLF) advanced 1 % each.  All 11 major S&P 500 sectors ended in positive territory.

The tech heavy Nasdaq gained 51.19 points after briefly entering negative territory early in the session Shares of Apple, Inc. (AAPL - Free Report) and Amazon.com, Inc. (AMZN - Free Report) gained 0.4% and 12%, respectively.

Turkish Lira Rebounds

On Tuesday, the Turkish lira finally staged a rebound after hitting an all-time low a day earlier. After falling to a record low of 7.24 per dollar on Monday, the Turkish lira rebounded about 8% to 6.36. The rebound followed after Turkey’s central bank took measures to ease pressure off the currency.

Turkey’s currency has been under pressure for some time, and declined further on Friday after the European Central Bank raised concerns over the country economy. Turkey’s president Recep Tayyip Erdogan’s growing powers has raised questions about the independence of Turkey’s central bank, taking the lira down on Friday.

Things further worsened, as tensions between the United States and Turkey escalated last week after a Turkish delegation returned with no apparent solutions regarding the detention of U.S. pastor Andrew Branson, who is facing charges of supporting a group accused of an attempted coup in 2016.

Moreover, President Donald Trump’s announcement supporting doubling of tariffs on a number of metals imported from Turkey made investors jittery on Monday. However, with Turkey’s central bank taking steps on Tuesday to ease the pressure off the currency, fears somewhat eased, leading to a rally in stocks.

Strong Earnings Boost Investors’ Confidence

The earnings season is drawing to a close and on Tuesday robust corporate results from a string of companies once again gave a boost to investors’ confidence. Second quarter results of 381 of the S&P 500 members are already out, with 80.1% of the companies beating EPS estimates, and 73.8% surpassing revenue estimates.

Understandably, this lifted investors’ confidence, leading to a rally in stocks. Moreover, despite signs of a slowdown in the U.S. housing market, Home Depot, Inc. (HD - Free Report) reported stronger-than expected sales.

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