Wall Street jumps as tech roars back, yields retreat
Facebook`s 9.2 percent jump after blockbuster results and gains in chipmakers powered technology stocks on Thursday, with easing U.S. bond yields helping the sentiment on Wall Street.
The tech-laden Nasdaq Composite index rose more than 1.5 percent, on track to break its five-day losing streak, its longest since November 2016. The S&P technology index rose 2.2 percent, the biggest gainer among the 11 major S&P sectors.
Facebook reported a strong 63 percent rise in profit and an increase in users, with no sign that business was hurt by a scandal over the mishandling of personal data.
Of the 227 S&P 500 companies that have reported first-quarter earnings so far, 79.7 percent topped profit estimates, according to Thomson Reuters data.
Analysts now expect earnings growth of 23.1 percent, compared with 18.6 percent at the start of the season.
Despite strong results from most U.S. firms that have reported so far, investors have been reacting to signs that rising inflation could take a toll on corporate profits.
The 10-year U.S. Treasury yield, the benchmark for global borrowing costs, pulled back from the 3 percent level it hit on Tuesday for the first time in four years.
"The rising yields are having an impact and there are some concerns that we`re in an environment where we`re seeing a peak in terms of earnings growth," said Emily Roland, head of capital markets research at John Hancock Investments in Boston.
"But some these factors are overshadowing the fact we have sturdy fundamental backdrop, both earnings and economic."
At 11:27 a.m. ET, the Dow Jones Industrial Average was up 184.07 points, or 0.76 percent, at 24,267.90, the S&P 500 was up 19.57 points, or 0.74 percent, at 2,658.97 and the Nasdaq Composite was up 99.16 points, or 1.42 percent, at 7,102.89.
Visa`s 4.5 percent jump, following the payments network`s better-than-expected profit and earnings forecast raise, provided the biggest boost to the Dow.
Advanced Micro Devices and Qualcomm were up 14.3 percent and 0.3 percent after the chipmakers posted quarterly results that beat Wall Street estimates, offsetting the recent worries over slowing smartphone chips demand.
The gains pushed the Philadelphia Semiconductor index up by more than 1.8 percent.
The Dow Jones Transport index fell 0.8 percent, led by 2.7 percent decline after Union Pacific, the No. 1 U.S. railroad, warned on a key operating metric.
General Motors fell 2.3 percent after the automaker reported a decline in quarterly profit and said it expected material costs to continue rising.
AT&T shares slumped 6.6 percent as the No. 2 U.S. wireless carrier lost subscribers from its pay TV business, hurting its profits. The three-member S&P telecom index fell 3.6 percent.
Advancing issues outnumbered decliners for a 1.86-to-1 ratio on the NYSE and for a 1.73-to-1 ratio on the Nasdaq.
The S&P index recorded 11 new 52-week highs and nine new lows, while the Nasdaq recorded 42 new highs and 37 new lows.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
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