Tech, health lead stocks gains at midday

Roman Schwartz
March 15, 2019

In the meantime, shares of the Dow component Boeing plunged more than 6 percent on Tuesday after an Ethiopian Airlines plane crash that happened on Sunday.

Technology stocks are powering broad gains on Wall Street, although a drop in Boeing is weighing on the Dow Jones Industrial Average.

A report showing that USA consumer prices rose modestly last month - the latest evidence that inflation remains in check - also helped lift stocks.

The market has been rebounding this week following its worst week since December. The blue chip Dow Jones Industrial Average finished at 25650.88, up 200.64 or +0.78% and the tech-based NASDAQ Composite closed at 7558.06, up 149.92 or +2.01%.

The Boeing loss restrained gains in the Dow, which rose 79 points, or 0.3 per cent, to 25,529.

Technology stocks powered the market's early gains.

F5 Networks Inc slipped almost 8%, the most on the S&P index, after the network software maker said it would buy privately held NGINX.

The two-day rally has helped the market reclaim the momentum it had in January and February, when it posted the best two-month start to a year since 1991. The S&P 500 moves up and down based on changes in its members' market value, but the Dow bounces around according to changes in its 30 members' stock prices.

Elsewhere, U.S. -China trade negotiations have continued this week as Chinese Vice Premier Liu He reportedly held a phone call with U.S. Treasury Secretary Steven Mnuchin and U.S. Trade Representative Robert Lighthizer on Tuesday, according to China's state news agency Xinhua. Costly tariffs have hurt both nations and investors hope a deal can be struck to at least take some pressure off the global economy, which has shown signs of cooling off.

Consumer Price Index (CPI) rose 0.2 percent, in line with estimates from economists polled by Reuters.

Boeing briefly dipped, but finished slightly higher, after the US said it was joining other countries in grounding the company's 737 Max 8 airplane following a fatal crash of an Ethiopian airliner over the weekend. A similar Lion Air plane crashed in Indonesia in October, killing 189 people.

The impasse has raised fears of a chaotic "no-deal" Brexit that could disrupt businesses in Britain and the 27 remaining European Union countries. Australia and Singapore suspended all flights into or out of their countries.

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The Labor Department's latest snapshot of consumer prices also put investors in a buying mood.

Traders bid up shares in Stitch Fix after the personal styling service blew past analyst's expectations for the fourth-quarter.

Coca-Cola Co dipped 0.1 percent after HSBC downgraded the soda maker's stock.

The news weighed on airline stocks.

"The most recent economic data fits with our 2019 outlook that suggests economic growth is likely to slow this year, but recession prospects remain very low", he intones that "This reinforces the view that the Federal Reserve will continue with patience with regards to any future rate hikes until such time that underlying economic fundamentals show significant improvement".

Google's parent company Alphabet rose 2.2 percent and Botox maker Allergan rose 2.1 percent.

CURRENCY: The dollar gained to 111.26 yen from Monday's 111.21 yen. The euro rose to $1.1297 from $1.1240.

ENERGY: The price of benchmark US crude oil rose 20 cents to $57.07 a barrel.

Minutes after Cox's advice, the pound was 1.1 percent lower at $1.3014, nearly two cents down from where it was earlier. Facebook rose 2.3 per cent and Morgan Stanley rose 1.3 per cent.

Another big loss in Boeing pulled the Dow Jones Industrial Average lower for the second day running.

Boeing's stock was up 20% this year after Tuesday's sell-off.

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