Benchmarks closed mostly higher on Thursday following a spate of strong corporate earnings from 3M and Caterpillar. While the Dow notched yet another record high, the S&P 500 ended in the green. However, the Nasdaq finished in the red. Meanwhile, at an interview to CNBC, President Trump stated that dollar would keep getting stronger under his administration. Finally, the ECB chose to leave the interest rates unchanged.
The Dow Jones Industrial Average (DJI) increased less than 0.5%, to close at 26,392.79. The S&P 500 rose almost 0.1% to close at 2,839.25. The tech-laden Nasdaq Composite Index closed at 7,415.06, losing almost 0.1%. The fear-gauge CBOE Volatility Index (VIX) decreased 0.5% to close at 11.41. A total of around 7.2 billion shares were traded on Thursday, higher than the last 20-session average of 6.7 billion shares.
Dow Surges to Record Close
The Dow amassed 140.7 points to hit a fresh record close. Such gains followed stupendous fourth quarter corporate earnings from 3M (MMM - Free Report) and Caterpillar (CAT - Free Report) . Shares of 3M surged 1.9% after the company reported strong fourth-quarter 2017 results with healthy year-over-year increase in adjusted earnings and revenues. Adjusted earnings for 2017 were up 12.4% year over year to $9.17 per share. Net sales were record high for fourth quarter at $7,990 million, up from $7,329 million in the year-ago quarter, and exceeded the Zacks Consensus Estimate of $7,878 million. (Read More)
Meanwhile, shares of Caterpillar edged up 0.6% after the company reported fourth-quarter 2017 results, wherein adjusted earnings of $2.16 surpassed the Zacks Consensus Estimate of $1.77 by a margin of 22%. Caterpillar posted revenues of $12.9 billion, handily beating the Zacks Consensus Estimate of $11.9 billion. In the trailing four quarters, excluding quarter under review, the company’s earnings have surpassed the Zacks Consensus Estimate by an average of nearly 53%. (Read More)
Earlier in the session the Dow was up 206 points. However, gains for the Dow were pared after Trump’s comments on the strength of the dollar weighed on the blue-chip index.In an interview to CNBC from World Economic Forum in Switzerland, Trump stated that the dollar will keep getting stronger under his administration and that U.S. Treasury of Secretary Steve Mnuchin’s remarks regarding dollar was “misinterpreted.” "The dollar is going to get stronger and stronger, and ultimately I want to see a strong dollar," he further stated.
What are the Other Benchmarks Doing?
The S&P 500 gained a meager 1.7 points to end in the positive territory. Gains for the broad-market index were rather broad based, buoyed by expectations of strong corporate earnings. Of the 11 major segments of the S&P 500, six ended in the positive territory, with utilities and healthcare leading the advancers. The Utilities Select Sector SPDR ETF (XLU) and the Health Care Select Sector SPDR ETF (XLV) gained 1.5% and 0.8%, respectively.
On the other hand, the Nasdaq lost almost 4 points to end the session in the negative territory. Losses for the tech laden index were due to a slump in technology stocks after Apple (AAPL - Free Report) and Xilinx plunged 1.8% and 5.1%, respectively. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
ECB decides not to Change the Interest Rates
On Thursday, the European Central Bank (ECB) chose to leave lending rates unchanged at 0% and rates on money kept in the bank overnight at -0.4%.
Further, the central bank stated that it planned to keep the rates unchanged for an "extended period" and "well past" the asset purchase program terminates.
On the economic front, the leading economic indicators for the month of December surged 0.6%, higher than 0.5% in the previous month. The consensus estimate for the period was an increase of 0.5%. Meanwhile, new home sales came in at 625,000 units for December, lower than the consensus estimate of 684,000.
Stocks That Made Headlines
Caterpillar Gains on Q4 Earnings Beat, Upbeat '18 View
Caterpillar Inc. reported an impressive surge year over year in fourth-quarter 2017 adjusted earnings per share. (Read More)
Xilinx Q3 Earnings & Revenues Top Estimates, Stock Up
Shares of Xilinx Inc. (XLNX - Free Report) rallied during yesterdays’ after-hour trade, after the chipmaker announced overwhelming third-quarter fiscal 2018 results, wherein its earnings and revenues, both, came ahead of the respective Zacks Consensus Estimate. (Read More)
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