Technology companies, solid earnings push US stocks higher

AP News
February 11, 2020 - 3:09 pm

FILE - In this Feb. 6, 2020, file photo specialist Meric Greenbaum, center, works with traders at his post on the floor of the New York Stock Exchange. The U.S. stock market opens at 9:30 a.m. EST on Tuesday, Feb. 11. (AP Photo/Richard Drew, File)


Stocks are closing mostly higher as investors weigh another round of mostly solid company earnings reports. Health care companies and banks rose. Technology stocks fell after federal regulators said they are ramping up a probe into Microsoft and other tech giants. Cruise operators, hotels and other companies that focus on travel made solid gains as traders brush off fears about the virus outbreak that originated in China. The S&P 500 rose 5 points, or 0.2%, to 3,357. The Dow Jones Industrial Average gave up an early gain and closed little changed at 29,276. The Nasdaq rose 10 points, or 0.1%, to 9,638.

THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.

Major U.S. stock indexes are mostly higher in late-afternoon trading Tuesday as investors weighed another round of mostly solid company earnings reports.

Health care stocks, banks and companies that rely on consumer spending accounted for a big slice of the gains, which placed the S&P 500 and the Nasdaq on track to eclipse record highs set a day earlier.

Technology stocks led the decliners, reversing an early gain, after federal regulators announced they've ramped up an antitrust probe into Microsoft, Facebook, Amazon, Apple and Google parent Alphabet.

After a downbeat January, U.S. stocks have been mostly notching gains this month as traders brush off fears about the virus outbreak in China and its impact on businesses and the global economy. The Chinese government has promised to take measures to soften the blow to its economy and investors are hopeful that other governments will do the same if necessary.

“Stocks are collectively saying, ‘hey, maybe we can work past some of the noise with the virus; maybe the fallout wont be as big as we thought," said Willie Delwiche, investment strategist at Baird. “And the U.S. economy, so far at least, looks like it's weathering it pretty well.”

Federal Reserve Chairman Jerome Powell gave a mostly reassuring assessment of the U.S. economy Tuesday. In his semiannual monetary report to Congress, Powell said it was too early to assess the threat the virus poses to the U.S. economy, but he noted that the economy “is in a very good place” with strong job creation and moderate growth.

Cruise operators, hotels and other companies that focus on travel made solid gains Tuesday. Hilton Worldwide rose 1.7% and Carnival rose 2.6%.

Citigroup and other banks rose broadly. Bond yields climbed, which allows banks to charge higher interest rates on mortgages and other loans. The yield on the 10-year Treasury rose to 1.58% from 1.54% late Monday.

AutoNation and Exelon rose after reporting solid earnings.

Sprint soared after a federal judge cleared a major obstacle to the company being acquired by T-Mobile.

KEEPING SCORE: The S&P 500 index rose 0.2% as of 3:38 p.m. Eastern time. The Dow Jones Industrial Average fell 18 points, or 0.1%, to 29,258. The Nasdaq rose 0.1%. The Russell 2000 index of smaller company stocks rose 0.5%. Markets in Europe and Asia rose.

IN THE CROSSHAIRS: The Federal Trade Commission is ordering Facebook, Amazon, Apple, Microsoft and Google's parent Alphabet to turn over detailed information on their acquisitions going back to 2010 as part of an investigation into the five giant tech companies' market dominance.

The FTC, the Justice Department and a House committee have been investigating the conduct of big tech companies and whether they aggressively bought potential rivals to suppress competition. Some critics have pointed to Facebook's acquisition of Instagram and WhatsApp, for example, as deals that should be questioned.

Microsoft slid 2.2%, the biggest decliner among tech sector stocks. Facebook fell 2.4% and Apple dropped 0.7%. Amazon shares were up 0.8%, while Alphabet rose 0.2%.

DENTED ARMOUR: Under Armour plunged 18.6% after the athletic gear company said it may need to restructure this year, which may involve scuttling the opening of its New York City flagship store. The company also gave investors a weak profit forecast for the year and said the virus outbreak in China will drag first-quarter sales down by $50 million to $60 million.

STRONG SIGNAL: Sprint surged 76.3% and T-Mobile jumped 12.1% after a federal judge rejected claims by a group of states that the deal would mean less competition and higher phone bills. T-Mobile has agreed to buy Sprint for $26.5 billion.

LINGERING VIRUS: China remained mostly closed for business as the daily death toll from a new virus topped 100 for the first time, pushing the total deaths above 1,000. The outbreak has infected more than 43,000 people globally, though the majority of the cases and deaths are in China.


AP Business Writer Damian J. Troise contributed.

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