U.S. Stocks Open Higher Despite Extended Brexit Uncertainty

By Caitlin Ostroff 

Share benchmarks rose in early New York trading Monday as investors awaited fresh developments on the U.K.'s divorce from the European Union and trade talks between China and the U.S.

The S&P 500 ticked up 0.4% ahead of more corporate results this week. So far, third-quarter earnings have beaten analysts' expectations, despite the slowing global economy. The Dow Jones Industrial Average added 0.1%, while the Nasdaq Composite Index picked up 0.6%.

Earlier, shares in Boeing declined 2.5% in premarket trading after The Wall Street Journal reported that Congress is ramping up scrutiny of the plane maker's leaders as new details pointed to undue management pressure on employees.

Shares of Cardinal Health dropped almost 4% premarket, while McKesson fell 2.1% and AmerisourceBergen declined 1.8%. The Journal reported that the companies reached a last-minute settlement, avoiding a trial seeking to blame them for fueling the opioid crisis.

Cosmetics maker Coty saw shares rally 6.7% after the company said it would explore strategic alternatives for its professional beauty business.

The British pound ticked up 0.2% against the dollar, climbing past the psychological barrier of $1.30 after a critical vote on Prime Minister Boris Johnson's Brexit dea l was delayed. The U.K.'s FTSE 100, which includes many companies with large overseas earnings that benefit from sterling's decline, edged up 0.2%.

"We're going to have that kind of ebbing and flowing," said David Madden, market analyst at CMC Markets. "It's just going to be hanging around to find out what's happening."

Optimism that Mr. Johnson will secure lawmakers' backing for his deal boosted European bond yields, with the rate on the 10-year U.K. gilt rising to 0.748% from 0.711% Friday afternoon and the 10-year German bund yielding minus 0.349%, up from minus 0.379% at the end of last week. The 10-year Italian bond climbed to 0.984% from 0.926%. Yields rise when prices fall.

The pan-continental Stoxx Europe 600 index rose 0.6%, led by banks and the automotive sector.

In European equity markets, U.K. medical-equipment company Smith & Nephew fell 8.7% after its chief executive said he would step down at the end of the month.

Wirecard rose 6.8% in German trading after the electronics payment company said it commissioned an auditing firm to look into allegations made in a report in the Financial Times about its accounting practices.

Write to Caitlin Ostroff at [e-mail]

(END) Dow Jones Newswires

October 21, 2019 09:46 ET (13:46 GMT)

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