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Stock Market News For Jun 29, 2018

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Wall Street bounce back on Thursday as all three major stock indexes closed in positive territory. The broad-based market rally was primarily led by strong showings of the financial and technology sectors. No new development took place in the trade front which enabled investors to opt for risky equities.

The Dow Jones Industrial Average (DJI) closed at 24,216.05, up 0.4%. The S&P 500 Index (INX) also increased 0.6% to close at 2,716.31. The Nasdaq Composite Index (IXIC) closed at 7,503.68, gaining 0.8%. A total of 7.13 billion shares were traded on Thursday, lower than the last 20-session average of 7.28 billion shares. Advancers outnumbered advancers on the NYSE by 1.52-to-1 ratio. On the Nasdaq, advancers had an edge over decliners by 1.23-to-1 ratio.  The CBOE VIX decreased 5.9% to close at 16.85.

How Did the Benchmarks Perform?

The Dow rose 0.4% with 25 of the 30-stock index closed in the green while 5 traded in the red. However, the blue-chip index remains below its 200-day moving average - a technical barrier to gauge the index’s long-term momentum trends - for the fourth straight session.

The S&P 500 gained 0.6% led by 1.2% increase of Technology Select Sector SPDR (XLK), 1% rise in Communication Services Select Sector SPDR (XLC) and 0.9% increase in Financials Select Sector SPDR (XLF). Notably, nine out of 11 sectors of the benchmark index ended in positive territory.

Likewise, the tech-laden Nasdaq Composite gained 0.8% due to strong showing by the large tech stocks.

Financial Sector Soars on Stress Tests Results

On Jun 28, the Fed declared results of the second round of its annual stress tests. The central bank has given the nod to 32 of the 35 biggest banks in the country to raise their dividends and buy back shares.

Moreover, the yield of the benchmark 10-year U.S. Treasury note added 2.2 basis points to 2.849% due to soft economic data. Following these two news the financial stocks rallied reversing a 13-day losing streak.

Consequently, major banks like JPMorgan Chase & Co. (JPM - Free Report) , Morgan Stanley (MS - Free Report) and The Goldman Sachs Group Inc. (GS - Free Report) gained 1.6%, 2.3% and 1.5%, respectively.

Technology Sector Return to Growth Path

The decision of the online retail giant Amazon.com Inc. (AMZN - Free Report) to diversify into healthcare boosted the entire technology sector.

Amazon has agreed to acquire PillPack, an online pharmacy that pre-sorts medications into different doses and handles both refills and renewals. This development immediately triggered a surge in the entire tech sector. Investors welcomed Amazon’s decision to diversify into healthcare sector, especially in the fields of drugstore chains, drug distributors and pharmacy benefit management.

As a result, the stock price of Amazon was up 2.5%. The stock carries a Zacks Rank #3 (Hold). You can seethe complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Economic Data

The Department of Commerce revealed its third and final estimate of the U.S. GDP for the first quarter of 2018. The final reading was an increase of 2%, lower than the 2.2% growth it reported the last month. The consensus estimate was a growth of 2.2%.

The lukewarm growth of GDP was primarily attributed to lower consumer spending which accounts for nearly 70% of the U.S. economy. For the first-quarter 2018, consumer spending was up 0.9% instead of the 1% increase reported earlier. It was the slowest pace of growth since the second quarter of 2013 and reflected downward trend in healthcare spending.

The Labor Department reported that claims for U.S. jobless benefits rose 9,000 to a seasonally adjusted 227,000 for the week ended Jun 23. The report also revealed that the number of people receiving benefits after an initial week of aid fell 21,000 to 1.71 million for the week ended Jun 16.

Stocks That Made Headlines

Enbridge Receives PUC Nod for Line 3 Replacement Project

After three years, Enbridge Inc. (ENB - Free Report) , Enbridge Energy Partners, L.P. (EEP - Free Report) and Enbridge Income Fund Holdings Inc. have received approval to proceed with Line 3 Replacement Project. (Read More)

5 Medical Stocks to Buy Now

Zacks names 5 companies poised to ride a medical breakthrough that is targeting cures for leukemia, AIDS, muscular dystrophy, hemophilia, and other conditions.

New products in this field are already generating substantial revenue and even more wondrous treatments are in the pipeline. Early investors could realize exceptional profits.

Click here to see the 5 stocks >>



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