Netflix, tech rally lift Wall Street as investors shrug off weak bank results

U.S. stocks rose on Tuesday as Netflix spurred a rally in technology and internet stocks and UnitedHealth posted strong results, while hopes of more stimulus for China`s slowing economy encouraged buying in risky assets.

Netflix Inc shares jumped 7 percent after the video streaming pioneer said it was raising prices for its U.S. subscribers. Other high-profile stocks such as Microsoft Corp , Amazon.com Inc and Apple Inc rose following the announcement.

The communication services sector <.splrcl>, which includes Netflix and Facebook, rose 1.64 percent, while technology stocks <.splrct> jumped 1.53 percent.

"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.

Disappointing earnings reports from big U.S. banks and Republican Senator Chuck Grassley`s comments on the progress in U.S.-China trade talks had tempered sentiment early in the day.

JPMorgan Chase & Co , the largest U.S. bank by assets, missed quarterly profit estimates due to a slump in bond trading revenue, while Wells Fargo & Co said its loan book shrank and quarterly revenue fell in all of its major businesses.

However, JPMorgan shares rose 0.7 percent and Wells Fargo shed some of its early losses to trade down 1.4 percent.

"I don`t think the reports that came out point to a weakness on a going forward basis," said Jonathan Golub, chief U.S. equity strategist at Credit Suisse.

"If we are not careening into recession, if interest rates are edging higher as the markets become a little more stable, those are positives for financial stocks."

The S&P financial index <.spsy> also turned higher, posting an 0.6 percent gain.

With the earnings season kicking off, analysts expect S&P 500 profits to have grown 14 percent in the fourth quarter, much lower than the 20.1 percent growth forecast in October, according to IBES data from Refinitiv.

Chinese officials came out in force on Tuesday hinting at more stimulus in the near term, easing concerns about a slowdown in the world`s second largest economy.

At 13:11 p.m. EDT, the Dow Jones Industrial Average <.dji> was up 133.81 points, or 0.56 percent, at 24,043.65, the S&P 500 <.spx> was up 24.39 points, or 0.94 percent, at 2,607.00 and the Nasdaq Composite <.ixic> was up 107.83 points, or 1.56 percent, at 7,013.75.

Health insurer UnitedHealth Group jumped 2.7 percent and was the top gainer on the Dow after reporting a better-than-expected quarterly profit.

Nine of the 11 major S&P sectors were higher, with only materials <.splrcm> and industrial indexes <.splrci> posting losses.

Investors will monitor 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 1.52-to-1 ratio on the NYSE and by a 1.57-to-1 ratio on the Nasdaq.

The S&P index recorded one new 52-week high and one new low, while the Nasdaq recorded 18 new highs and 13 new lows.

(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)