Stocks Power on, Heading for Strong Finish to Volatile Month
NEW YORK (AP) — Stocks climbed broadly on Wall Street in early trading Friday as the market extended a recent rally and closed in on a big weekly gain after four straight weeks of losses.
Despite marching higher most of this week, the market is on track to finish August with a loss. That would be only the second monthly decline this year after May.
Technology companies and banks did the most to lift major indexes. Intel rose 1.8% and Citigroup added 1.2%.
Campbell Soup jumped 6.4% and Big Lots vaulted 9%. Both companies reported quarterly profits that easily beat analysts’ forecasts. Ulta Beauty plunged 25% after reporting weak results and cutting its estimates.
The S&P 500 was up 0.4% as of 10:15 a.m. Eastern Time. The Dow Jones Industrial Average climbed 116 points, or 0.4%, to 26,470. The Nasdaq gained 0.1%.
Major stock indexes in Europe also moved broadly higher.
While the major U.S. indexes have stemmed some of their losses from earlier this month, they remain down more than 1% for the month.
Trading turned volatile in August as investors worried that the escalating trade war between the U.S. and China and slowing global economy could tip the U.S. into a recession. The bond market seemingly confirmed these fears when long-term bond yields fell below short-term ones, a so-called inversion in the U.S. yield curve that has correctly predicted previous recessions.
Bond prices fell Friday, but long-term bond yields continued to trail short-term ones. The yield on the 10-year Treasury rose to 1.52% from 1.51% late Thursday. The 2-year Treasury yield rose to 1.53% from 1.55% the day before.
Washington and Beijing are deadlocked in talks over U.S. complaints about China’s trade surplus and industry plans, which its trading partners say are based on stealing or pressuring companies to hand over technology.
Last week, the trade conflict escalated again with both sides threatening new tariffs on each other’s goods, triggering a sharp sell-off in global markets.
Some of the Trump administration’s additional tariffs on Chinese products take effect Sunday and others on Dec. 15. In addition, higher tariffs on a separate group of Chinese products are to take effect Oct. 1.
Still, investors were encouraged by a Chinese government statement Thursday that its penalties on U.S. products are adequate. That suggested Beijing might be pausing in a tit-for-tat cycle of tariff increases by both sides that has raised fears the global economy might tip into recession.
Negotiators meet next month in Washington after the latest round of talks in July in Shanghai produced no sign of progress.
U.S. markets will be closed Monday for Labor Day.
By AP reporter Alex Veiga