Major U.S. indexes managed small gains on Wall Street but not enough to prevent a losing week for the S&P 500 following three weeks of gains and more in Thursday’s Stock Market Update.
Industrial companies rose Thursday as traders welcomed solid earnings from Snap-on, Honeywell and Union Pacific. Financial and energy stocks fell.
Investors are focused on company earnings as they look for clues on the health of the U.S. economy and the prospects for better corporate profits, a key driver of stock market gains. Analysts expect the first quarter results for S&P 500 companies to be the weakest in nearly three years.
The market also got a boost from positive economic data on U.S. retail sales and unemployment claims.
Traders gave a strong reception to Pinterest and Zoom Video Communications, two technology companies that made their widely anticipated stock market debuts.
Cigarette makers fell on news that the U.S. Senate’s majority leader plans to introduce legislation to raise the minimum age to buy tobacco products from 18 to 21.
U.S. stock markets were wrapping up a shortened week Thursday before closing for the Good Friday holiday.
STOCK MARKET UPDATE
ANALYST’S TAKE: “It’s a short week, so there’s a little jockeying for position as we got into the long weekend,” said Karyn Cavanaugh, senior markets strategist at Voya Investment Management. “We haven’t really gotten to the meat of earnings season and (investors) want to see some really positive guidance and they want to make sure earnings are growing.”
KEEPING SCORE: The S&P 500 edged up 4 points, or 0.2%, to 2,905. The Dow Jones Industrial Average added 110 points, or 0.4%, to 26,559. The Nasdaq inched up 1 point to 7,998.
Bond prices rose. The yield on the 10 year Treasury fell to 2.56%.
Major European stock indexes finished mostly higher.
SO INDUSTRIOUS: Several industrial sector stocks surged after reporting solid quarterly results.
Snap-On climbed 6.5% after the tool and diagnostic equipment maker’s first quarter profit beat forecasts and it reported growth in its U.S. franchise network.
Union Pacific gained 4.6% after the railroad’s first quarter profit climbed 6% even though the company hauled 2% fewer carloads and dealt with massive flooding. Union Pacific’s earnings topped analysts’ estimates, though its revenue declined, falling short of analysts’ forecasts.
United Rentals surged 8.3% after the construction equipment rental company’s first quarter results beat Wall Street’s expectations.
Honeywell International picked up 3.5% after its first quarter earnings topped analysts’ forecasts thanks to a strong sales growth in aerospace, building technologies and other lines of business. The company also raised its earnings guidance for the year.
STRONG DEBUT: Pinterest and Zoom surged in their first day of trading.
Pinterest, which lets users share images of crafts and other projects, jumped 29.5% from its IPO pricing of $19. Zoom, a maker of video conference technology, vaulted 75.9% from its IPO pricing of $36.
The San Francisco-based companies’ market debuts came less than a month after ride-hailing service Lyft began trading. In what might be a cautionary tale for other anticipated tech IPOs, Lyft shares surged on their first day but have since plunged back below their original offering price.
SMOKED: Shares in cigarette makers fell after Senate Majority Leader Mitch McConnell said he plans to introduce legislation to raise the minimum age to buy tobacco products from 18 to 21 nationally.
The Senate leader said his bill will cover all tobacco products, including vaping devices, and will continue to hold retailers responsible for verifying the age of anyone buying tobacco products. About a dozen states have already enacted laws raising the minimum legal age to 21.
Altria Group fell 2.9% and Philip Morris International dropped 0.9%.
NOT A GOOD LOOK: Skechers USA tumbled 10.1% after the footwear company’s first quarter result fell short of Wall Street’s forecasts. The company also issued second quarter guidance that came in below analysts’ estimates.
DISSAPOINTING RESULTS: KeyCorp fell 1.6% after the bank’s latest quarterly snapshot missed analysts’ targets as income from fees declined.
MIXED RESULTS: American Express rose 2% after the credit card issuer reported lower earnings in the first quarter, but still beat analysts’ estimates. The company’s revenue fell short of Wall Street’s forecasts.
CANNABIS DEAL: Canopy Growth climbed 4.2% after the cannabis company signed a deal giving it the right to buy Acreage Holdings Inc. if the U.S. government legalizes the drug.
ECONOMIC DATA: The Commerce Department said U.S. retail sales surged in March at the fastest pace since late 2017, driven by increased spending on autos, gasoline, furniture and clothing.
The gains mark a sharp rebound from a lackluster period of sales dating back to December. It’s a sign that the healthy job market has likely made consumers more eager to spend in ways that boost overall economic growth.
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