Technology companies lead early gains for US stocks
TOKYO (AP) — Major share benchmarks were mostly lower in Asia on Wednesday after China announced its economy grew at a 6.4% annual pace in the last quarter.
Japan’s Nikkei 225 index gained 0.3% to 22,289.32 and the Shanghai Composite was almost unchanged at 3,252.42. Hong Kong’s Hang Seng index fell 0.3% to 30,047.39 while the S&P ASX 200 in Australia lost 0.3% to 6,252.30.
Shares rose in Taiwan and Singapore.
The 6.4% growth rate for January-March was in line with Beijing’s official annual target for a 6-6.5% expansion and suggests government efforts to halt a slowdown are working.
However, it matched the previous quarter for the weakest growth since 2009 and did little to spur buying enthusiasm.
“It’s not entirely clear what is behind this strength. Growth in industrial sales for export edged up last month from 4.2% year-on-year to 5.7% but doesn’t stand out as especially strong,” Julian Evans-Pritchard of Capital Economics said in a commentary.
“Domestic demand has picked up too, but likewise, the gains appear more modest than those in industrial output,” it said.
Meanwhile, Japan released trade data for March showing its exports fell 2.4% from a year earlier, while the trade surplus sank 33%.
On Wall Street, stocks closed slightly higher Tuesday, erasing modest losses from the day before. The gains followed a rally in overseas stock indexes and came as investors sized up the latest batch of company earnings reports.
Financial stocks led the way higher as bond yields rose, which drives interest rates higher, enabling banks to make more money on loans. BlackRock and Progressive led the sector after each company reported solid quarterly results.
Qualcomm powered technology sector stocks higher, gaining 23.2% in its best day in 20 years, on news the chipmaker and Apple had settled their bitter legal dispute centered on some of the technology that enables iPhones to connect to the internet.
The deal requires Apple to pay Qualcomm an undisclosed amount. It also includes a six-year licensing agreement that likely involves recurring payments to the mobile chip maker.
The surprise truce announced late Tuesday afternoon came just as the former allies turned antagonists were facing off in a federal court trial that was supposed to unfold over the next month in San Diego. The resolution abruptly ended that trial, which also involved Apple’s key iPhone suppliers.
Companies that posted encouraging results helped put traders in a buying mood Tuesday.
The S&P 500 rose 0.1% to 2,907.06. The Dow Jones Industrial Average gained 0.3% to 26,452.66. The Nasdaq composite added 0.3% to 8,000.23. The index had not closed above 8,000 points since October.
The Russell 2000 index of small-cap stocks picked up 0.2% to 1,582.79.
But analysts expect first-quarter results for S&P 500 companies overall to be the weakest in nearly three years.
“The markets are prepared for this year-over-year decline that everyone is expecting in earnings,” said Erik Davidson, chief investment officer at Wells Fargo Private Bank. “Unless we have some significant misses, we should be doing OK.”
The yield on the 10 year Treasury note rose to 2.59% from 2.55% late Monday. The 10 year Treasury yield has been climbing since late last month, when it fell to 2.37% amid a crescendo of worries that global economic growth was slowing.
ENERGY: Benchmark U.S. crude oil rose gained 41 cents to $64.45 per barrel in electronic trading on the New York Mercantile Exchange. It gained 1% to settle at $64.05 per barrel on Tuesday. Brent crude, the international standard, added 22 cents to $71.94 per barrel. It picked up 0.8% to close at $71.72 per barrel in London.
CURRENCIES: The dollar slipped to 111.95 Japanese yen from 112.01 yen. The euro strengthened to $1.1303 from $1.1282.
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AP Business Writer Alex Veiga contributed.
The Western Journal has not reviewed this Associated Press story prior to publication. Therefore, it may contain editorial bias or may in some other way not meet our normal editorial standards. It is provided to our readers as a service from The Western Journal.
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