Netflix boosts Wall Street higher; bank earnings disappoint
U.S. stocks rose on Tuesday, as hopes of more stimulus for China`s slowing economy and a jump in Netflix shares helped investors look past disappointing earnings from JPMorgan and Wells Fargo.
Netflix Inc jumped 6.12 percent after the video streaming service pioneer said it was raising prices for its U.S. subscribers.
The price increases, ahead of the company`s fourth-quarter report on Thursday, boosted the communication services sector by 1.32 percent.
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"Investors are expecting earnings to be lower in 2019. However, a lot of the company reports that we read are still pretty positive. They are looking to hire, invest in businesses, looking to raise prices," said Matthew Watson, portfolio manager of James Golden Rainbow Fund in Xenia, Ohio.
JPMorgan Chase & Co dropped about 1 percent after the biggest U.S. lender by assets reported a lower-than-expected rise in quarterly profit and revenue, while Wells Fargo & Co fell 2.40 percent after its quarterly revenue missed estimates.
The bank subsector dropped 0.32 percent, while the S&P 500 financial index declined marginally.
"Bank earnings were not as strong as markets expected, but maybe not as worse as the markets expected either. Maybe it`s some relief," Watson said.
At 11:21 a.m. ET, the Dow Jones Industrial Average was up 81.33 points, or 0.34 percent, at 23,991.17. The S&P 500 was up 18.21 points, or 0.71 percent, at 2,600.82 and the Nasdaq Composite was up 82.95 points, or 1.20 percent, at 6,988.87.
Eight of the 11 major S&P sectors were higher, led by a 1.41 percent gain for the healthcare sector.
Health insurer UnitedHealth Group jumped 2.96 percent and was the top gainer on the Dow after reporting a better-than-expected quarterly profit.
Market sentiment was briefly tempered following the disappointing earnings from big U.S. banks and Republican Senator Chuck Grassley`s comments on U.S.-China trade talks.
U.S. Trade Representative Robert Lighthizer did not see much progress made on structural issues during the trade talks last week, Grassley said.
Chinese officials are due to visit Washington for further trade talks in a couple of weeks, he added.
Concerns about the impact of the trade war on global growth and rising interest rates have taken a toll on fourth-quarter profit expectations.
Analysts now estimate S&P 500 earnings will grow 14 percent in the fourth quarter, much lower than the 20.1 percent growth forecast in October, according to IBES data from Refinitiv.
Investors will monitor the voting on British Prime Minister Theresa May`s Brexit deal, a decision which will define Britain`s departure from the European Union and set the course for the country`s economy.
Voting is expected to start at about 1900 GMT, or 2:00 p.m. ET.
Advancing issues outnumbered decliners by a 1.69-to-1 ratio on the NYSE and by a 1.69-to-1 ratio on the Nasdaq.
The S&P index recorded one new 52-week high and one new low, while the Nasdaq recorded 15 new highs and 11 new lows.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)