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Stock Market News For Mar 14, 2019

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U.S. stocks closed sharply higher on Wednesday following the release of strong economic data. Meanwhile, the UK parliament has voted against a no-deal Brexit and President Donald Trump said that he is ready to give more time for a trade deal to be concluded with China. Both these developments strengthened investors’ confidence. All three indexes ended in the green.

The Dow Jones Industrial Average (DJI) closed at 25,702.89, gaining 0.6% or 148.23 points. The S&P 500 Index (INX) increased 0.7% to close at 2,810.92. Meanwhile, the Nasdaq Composite Index (IXIC) closed at 7,643.41, gaining 0.7%. A total of 7.3 billion shares were traded on Wednesday, lower than the last 20-session average of 7.4 billion shares. Advancers outnumbered decliners on the NYSE by 2.43-to-1 ratio. On the Nasdaq, advancers had an edge over decliners by 1.62-to-1 ratio.  The CBOE VIX decreased 2.6% to close at 13.41.      

How Did the Benchmarks Perform?

The Dow ended in positive territory reversing previous day’s losses. Notably, 28 stocks of the 30-stocks blue-chip index finished in the green while two ended in the red. The Dow’s best performer was UnitedHealth Group Inc. (UNH - Free Report) which soared 2.6%. UnitedHealth Group carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The S&P 500 also closed in the green for the third successive day. Wednesday’s close of $2,810.92 was the highest since Nov 7. For the second time in 2019, the broad market index finished above the crucial technical barrier of 2,800. The Health Care Select Sector SPDR (XLV) and Energy Select Sector SPDR (XLE) gained 1.1% each. Notably, all eleven sectors of the benchmark index closed in the green.

The tech-heavy Nasdaq finished in the green for the third consecutive day buoyed by strong performance of technology stocks.

Robust Economic Data

On Mar 13, the Department of Commerce reported that new orders for manufactured durable goods rose $0.9 billion or 0.4% to $255.3 billion in January from December. This was the third straight month of growth for durable goods orders. Notably, the consensus estimate for factory orders in January was for a decline of 0.4%.    

Core durable goods orders (which exclude defense aircraft) jumped 0.8% in January after witnessing sharp fall in previous two months. This also reflects highest monthly gain of core factory orders since July 2018.

Construction spending increased 1.3% in January, its highest since April 2018. The consensus estimate was for a growth of 0.4%. Meanwhile, December’s data was revised negatively from a contraction of 0.6% to contraction of 0.8%. On a year-over-year basis, construction spending rose 0.3% in January.   Investment in public construction projects increased 4.9%, its highest level since September 2010.

Producer’s Price Index (PPI) rose 0.1% in January, better-than the consensus estimate of a rise of 0.2%. Core PPI also increased 0.1% in January.

Britain Votes Against No-Deal Brexit

On Mar 13, the UK parliament voted against a no-deal Brexit. On Mar 12, British lawmakers rejected the proposed Brexit deal submitted by British Prime Minister Theresa May. The British parliament rejected the deal with 321 members voting against it while 278 supported the deal. Britain will now decide whether the Mar 29, exit date from the European Union will be deferred.

Trump to Wait for Trade Negotiation

Per The Wall Street Journal, President Trump said that he is ready to wait for some time and is in no hurry to seal a trade deal with China by March. His willingness to provide more time is aimed at clinching a lasting agreement with China which will strictly protect U.S. intellectual properties. The newspaper reported that both sides are working hard to seal a mutually acceptable deal.

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