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Stock Market News For Feb 1, 2019

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U.S. stocks closed mostly higher on Thursday following positive developments on the trade war front. Moreover, strong fourth quarter earnings results boosted investors’ confidence in risky assets like equities. The S&P 500 and Nasdaq Composite closed in the green while the Dow dropped marginally.

The Dow Jones Industrial Average (DJI) closed at 24,999.67, losing 0.1%. Meanwhile, the S&P 500 Index (INX) increased 0.9% to close at 2,704.10. The Nasdaq Composite Index (IXIC) closed at 7,281.74, rising 1.4%. A total of 9.5 billion shares were traded on Thursday, higher than the last 20-session average of 7.7 billion shares. Advancers outnumbered decliners on the NYSE by 2.40-to-1 ratio. On the Nasdaq, advancers had an edge over decliners by 1.80-to-1 ratio.  The CBOE VIX decreased 6.2% to close at 16.57.     

How Did the Benchmarks Perform?

The Dow ended marginally lower reversing previous day’s gains. Notably, 19 stocks of the 30-stocks blue-chip index finished in the green while eleven ended in red. The tech-heavy Nasdaq Composite ended in the green for two-straight days, due to strong performance by large tech stocks.

The S&P 500 closed in positive territory for second consecutive days. The Communication Services Select Sector SPDR (XLC), Utilities Select Sector SPDR (XLU) and Consumer StaplesSelect Sector SPDR (XLP) were major gainers with 4.1%, 2.1% and 1.9%, respectively. However, Materials Select Sector SPDR (XLB) lost 1.5%. Notably, eight out of 11 sectors of the benchmark index closed in the green while he remaining three finished in the red.

Positive Developments on Trade War Front

On Jan 31, President Donald Trump told reporters that he is hopeful of forging a deal with China before the March deadline. Notably, the two countries are currently observing a trade truce which will come to end on Mar 1.

Moreover, CNBC reported citing sources that officials of the two countries are trying to organize meeting between President Trump and his Chinese counterpart Xi Jinping in late February. This will be the second meeting between the two leaders in less than three months.

Notably, ongoing trade-related concerns between the United States and China are the biggest reasons for an impending global economic slowdown in 2019. If the tariff conflict between the two largest trading countries can be resolved, it will bolster global economic growth.

Strong Q4 Earnings

Better-than expected fourth quarter earnings results by some major companies have lifted investors’ confidence.

Facebook Inc. reported fourth-quarter 2018 earnings of $2.38 per share that beat the Zacks Consensus Estimate by a whopping 21 cents. Mobile ad revenues surged 36% year over year to $15.5 billion, contributing 93% to total ad revenues. (Read More). Consequently, shares of Facebook jumped 10.8%. Facebook carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 RanK (Strong Buy) stocks here.

Shares ofGeneral Electric Co. (GE - Free Report) surged 11.7% after reporting fourth quarter earnings results. Although adjusted earnings per share of $0.17 missed the Zacks Consensus Estimate by one cent, consolidated revenues of $33,278 million, outpaced the Zacks Consensus estimate of $32.230 billion. Moreover, six out of its seven reporting segments generated strong revenue growth. (Read More) Consequently, shares of General Electric jumped 11.7%.

Economic Data

The Department of Labor reported that initial jobless claims increased 53,000 to a seasonally adjusted 253,000 for the week ended Jan. 26, highest level in 16 month. The figure was also above the consensus estimate of 216,000. Jobless people already collecting unemployment benefits or continuing claims rose by 69,000 to 1.78 million.

The Department of Commerce reported that new home sales in November increased 17% to a seasonally adjusted 657,000, marking the highest pace in 8-months. However, sales declined 7.7% year over year.

Monthly Roundup

After a disappointing 2018, U.S. stock markets have rebounded in January 2019.All three major stock indexes gained significantly. The Dow advanced 7.2%, marking its best January since 1989. The S&P 500 gained 7.9%, its best performance in January since 1987. The Nasdaq Composite surged 9.7%, reflecting highest gain in January since 2001.

Positive developments on trade war front, Fed’s dovish monetary stance and stable oil prices were major catalysts behind the stock market rally.Strong fourth quarter earnings and temporary end to partial government shutdown resulted in a stock market rally.

Stocks That Made Headline

SkyWest Q4 Earnings & Revenues Top on Fleet Upgrade

SkyWest Inc. (SKYW - Free Report) delivered better-than-expected results in the fourth quarter of 2018. (Read More)

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