US close: Stocks finish positive amid positive trade chatter
Wall Street markets finished in the green on Monday, as the S&P 500 hit a fresh record high close on the back of additional positive headlines around the US-China trade war and bullish calls from some of Wall Street's largest investment banks.
The Dow Jones Industrial Average rose 0.49% to close at 27,090.72, the S&P 500 added 0.56% to 3,039.42, and the Nasdaq 100 was 1.01% firmer at 8,110.67.
Earlier in the session, the S&P also recorded a new record intraday high.
"For all the chatter, bulls remain in charge,” said Neil Wilson, chief market analyst at Markets.com.
“It's a remarkable achievement against faltering corporate earnings, a festering - if not quite total - trade war, and softer macro data everywhere you look.”
At the weekend, Chinese officials confirmed that Beijing and Washington were close to finalising the first phase of a trade deal, although some market commentary was highlighting how many of the trade tariffs from both sides would remain in place, while sounding a sceptical note on the prospect of follow-up trade deals.
Analysts at Morgan Stanley told clients that shares were more likely to see rotation between sectors rather than "do well overall".
Their peers at JP Morgan were upbeat on the likelihood that a deescalation in trade tensions and continued policy easing by central banks could drive a recovery in company earnings.
"Tariffs have been the largest headwind for global growth and corporate profits, which, based on our estimates, reduced 2019 S&P 500 earnings growth potential by 7-8%," JP Morgan analysts said in a research reports sent to clients.
Their mid-year 2020 target for the S&P 500 was 3,200 points, but "given improving trade rhetoric" that level might be reached sooner, at the end of 2019 of start of 2020.
"S&P 500 companies could see [more than] 25% cumulative earnings per share growth over two years if tariffs are unwound," they added.
Bank of America-Merrill Lynch analysts were even more bullish, saying that the S&P 500 might rise to 3,333 by the next 'Super Tuesday' for US primary elections on 3 March.
In economic news, the Department of Commerce reported a 3.6% month-on-month drop in the US trade deficit in goods to reach -$70.4bn in September, which was down from -$73.1bn for August.
In the same report, Commerce said that wholesale inventories dropped at a 0.3% month-on-month pace in September, wider than Barclays forecasts for a 0.1% fall.
On the corporate side of things, the market spotlight was on shares of Tiffany & Co, after the luxury jeweller announced that it had received a takeover offer from France's LVMH, valuing it at $120 a share.
Stock in Tiffany was trading above the mooted acquisition price, and closes up 31.64% at $129.72.
Telecommunications giant AT&T posted fourth quarter earnings per share of 94 cents, beating consensus expectations for 93 cents, but on sales of only $44.6bn, falling short of forecasts for $45.0bn.
Its shares ended the session up 4.39%.
Spotify was another big gainer, adding 16% following its third quarter earnings report, while Microsoft powered ahead by 2.46% after coming out on top in the US government's $10.0bn tender for the Joint Enterprise Defense Infrastructure contract.
Google parent Alphabet finished the session up 1.97%, but fell back 1.4% in after-hours trading as it posted its latest quarterly figures following the bell.
Dow Jones - Risers
Microsoft Corp. (MSFT) $144.19 2.46%
3M Co. (MMM) $169.06 1.79%
Goldman Sachs Group Inc. (GS) $217.75 1.64%
Pfizer Inc. (PFE) $37.27 1.39%
Visa Inc. (V) $179.84 1.12%
Home Depot Inc. (HD) $236.80 1.03%
Apple Inc. (AAPL) $249.05 1.00%
Unitedhealth Group Inc. (UNH) $247.04 0.87%
Walgreens Boots Alliance, Inc. (WBA) $55.80 0.69%
Johnson & Johnson (JNJ) $129.18 0.65%
Dow Jones - Fallers
McDonald's Corp. (MCD) $191.78 -1.45%
Exxon Mobil Corp. (XOM) $68.62 -0.88%
Travelers Company Inc. (TRV) $129.30 -0.87%
Coca-Cola Co. (KO) $53.56 -0.33%
Verizon Communications Inc. (VZ) $60.18 -0.31%
Walt Disney Co. (DIS) $130.53 -0.28%
Chevron Corp. (CVX) $118.48 -0.16%
Nike Inc. (NKE) $90.84 -0.08%
Merck & Co. Inc. (MRK) $82.20 -0.07%
Dowdupont Inc. (DWDP) $30.52 0.00%
S&P 500 - Risers
Tiffany & Co. (TIF) $129.72 31.63%
Nektar Therapeutics (NKTR) $17.70 6.12%
Affiliated Mgrs Group (AMG) $81.50 5.38%
Illumina Inc. (ILMN) $304.06 4.62%
Tyson Foods Inc. (TSN) $82.08 4.59%
AT&T Inc. (T) $38.49 4.28%
Lam Research Corp. (LRCX) $281.25 4.15%
Edwards Lifesciences Corp. (EW) $237.09 3.89%
QUALCOMM Inc. (QCOM) $83.05 3.59%
Svb Financial Group (SIVB) $227.28 3.41%
S&P 500 - Fallers
ProLogis (PLD) $85.89 -5.47%
Molson Coors Brewing Co. Class B (TAP) $54.57 -3.99%
Cabot Oil & Gas Corp. (COG) $18.11 -3.72%
D. R. Horton Inc. (DHI) $51.82 -3.52%
PVH Corp. (PVH) $89.67 -3.34%
Pioneer Natural Resources Co. (PXD) $125.55 -3.30%
Loews Corp. (L) $49.42 -3.10%
Cimarex Energy Co (XEC) $44.57 -3.09%
Whirlpool Corp. (WHR) $154.54 -3.02%
American Tower Corp (Reit) (AMT) $210.75 -2.73%
Nasdaq 100 - Risers
Illumina Inc. (ILMN) $304.06 4.62%
Lam Research Corp. (LRCX) $281.25 4.15%
QUALCOMM Inc. (QCOM) $83.05 3.59%
Incyte Corp. (INCY) $79.86 2.98%
Align Technology Inc. (ALGN) $250.42 2.89%
KLA-Tencor Corp. (KLAC) $174.78 2.85%
Biogen Inc (BIIB) $295.54 2.60%
Microsoft Corp. (MSFT) $144.19 2.46%
Western Digital Corp. (WDC) $62.73 2.45%
Applied Materials Inc. (AMAT) $56.95 2.21%
Nasdaq 100 - Fallers
Take-Two Interactive Software Inc. (TTWO) $122.78 -2.03%
Mercadolibre Inc. (MELI) $540.03 -1.78%
Activision Blizzard Inc. (ATVI) $54.56 -1.27%
Ross Stores Inc. (ROST) $109.39 -1.17%
CSX Corp. (CSX) $71.52 -1.11%
Dollar Tree Inc (DLTR) $113.42 -0.99%
Fastenal Co. (FAST) $36.83 -0.94%
Workday, Inc. (WDAY) $159.40 -0.84%
Idexx Laboratories Inc. (IDXX) $266.42 -0.70%
Mondelez International Inc. (MDLZ) $52.41 -0.68%