Tech stocks, Netflix power Wall Street's gains
U.S. stocks rose about 1 percent on Tuesday, helped by gains in technology companies and as strong earnings from Netflix and UnitedHealth boosted optimism over what is expected to be the strongest earnings season in seven years.
Netflix shares rose 10 percent to hit an all-time high after the video-streaming pioneer smashed analysts` quarterly subscriber estimates.
UnitedHealth jumped 3 percent after the largest U.S. health insurer raised its earnings forecast and posted results that beat Wall Street estimates.
Analysts expect profits of S&P 500 companies to rise 18.6 percent in the first quarter, the biggest increase in seven years, according to Thomson Reuters data.
"Being able to surprise on the upside in the phase of higher expectations would be a real sign of strength," said Willie Delwiche, investment strategist at Robert W. Baird in Milwaukee.
Hopes about a strong reporting season have helped divert attention from geopolitical and trade worries, which have roiled the markets in recent months.
"We`ve seen enough pessimism build up in investors as people are trying to look for the worst ... things blowing up from a geopolitical perspective. Earnings so far have been good enough to help leave some of the pessimism that`s out there," Delwiche said.
At 12:36 a.m. ET the Dow Jones Industrial Average was up 0.88 percent at 24,789.21. The S&P 500 rose 1 percent to 2,704.74 and the Nasdaq Composite gained 1.67 percent to 7,275.82.
At their session highs, all three indexes were above their 50-day moving averages.
Data on Tuesday showed U.S. homebuilding increased more than expected in March amid a rebound in the construction of multi-family housing units. The PHLX housing index rose 1.12 percent.
Ten of 11 major S&P sectors were higher, led by the technology index`s 1.9 percent gain. The consumer discretionary index rose 1.64 percent, boosted by Netflix and Amazon, which gained 3.2 percent.
BofA Merrill Lynch`s April fund manager survey found the world`s biggest tech stocks were investors` top pick for the third straight month despite mounting worries over regulation.
Facebook, Apple, Amazon, Netflix and Alphabet — collectively known as the FAANG group — rose between 1.4 percent and 9.7 percent.
Goldman Sachs reversed course to drop 1.7 percent, mirroring other big U.S. banks, shares of which declined despite beating Wall Street`s profit expectations.
J&J fell 1.43 percent after the healthcare conglomerate raised its sales forecast for the year but kept its outlook for full-year profit unchanged.
Advancing issues outnumbered decliners on the NYSE for a 2.74-to-1 ratio, and on the Nasdaq, for a 2.52-to-1 ratio.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
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