By Mark DeCambre, MarketWatch , Sunny Oh
Boeing shares suffer third straight decline
U.S. stock benchmarks closed higher Monday, amid optimism over
tariff talks and better-than-expected corporate earnings, but a
decline in shares of Boeing capped gains for the blue-chip Dow
Jones Industrial Average.
How did the major indexes perform?
The Dow ended the day 57.44 points, or 0.2%, higher at
26,827.64.
Boeing Co.'s stock (BA) extended its decline to a two-month low,
down 3.8%, following a report on Friday that said the company may
have misled federal aviation authorities
(http://www.marketwatch.com/story/boeing-stock-at-its-lowest-in-two-months-after-report-jet-maker-may-have-misled-faa-2019-10-18)
about the safety of the 737 Max jet. The drop produced a roughly
70-point drag on the blue-chip Dow. The aviation and defense
contractor has traded down three straight sessions.
The S&P 500 index , meanwhile, advanced 20.52 points, or
0.7%, to end at 3,006.72, leaving it 0.6% away from its record
closing high of 3,025.86 set on July 26. The Nasdaq Composite Index
climbed 73.44 points, or 0.9%, to finish at 8,162.99.
What drove the market?
China's Vice Premier Liu He said Washington and Beijing have
laid the groundwork for success in the first phase of its attempt
to carve out a resolution to its trade disagreement. "China and the
U.S. have made substantial progress in many aspects, and laid an
important foundation for a phase one agreement," said China's top
trade negotiator at a technology conference in Nanchang, Jiangxi,
on Saturday, Bloomberg News reported (paywall)
(https://www.bloomberg.com/news/articles/2019-10-19/china-s-liu-confirms-phase-one-of-u-s-trade-deal-is-in-progress?cmpid=BBD102119_MKT&utm_medium=email&utm_source=newsletter&utm_term=191021&utm_campaign=markets).
President Donald Trump also pronounced his optimism on the
likelihood of a deal, saying it was coming along great on Monday.
(https://t.co/cWKkw7O8SI?amp=1)
Meanwhile, U.K. British Prime Minister Boris Johnson was forced
to ask the European Union for a three-month extension to the Oct.
31 deadline to exit from the trade bloc, representing the latest
setback for the British leader and the country's yearslong attempt
to forge an orderly separation. The Germany's economic affairs
minister said he thought the EU would approve the extension
request.
Johnson is seeking another vote on his Brexit proposal in
Parliament on Monday, but U.K. House of Commons Speaker John Bercow
rejected his bid
(http://www.marketwatch.com/story/uk-house-speaker-bercow-rejects-government-bid-to-hold-a-new-brexit-vote-2019-10-21),
saying a new vote "would be repetitive and disorderly."
Read:What the latest Brexit setback means for markets
(http://www.marketwatch.com/story/what-the-latest-brexit-setback-means-for-markets-in-a-crunch-week-for-the-uk-2019-10-21)
Markets have been focused on the threat of Britain crashing out
of the EU without a trade agreement, which some fear could disrupt
global markets.
In corporate earnings, of the roughly 75 S&P 500 companies
that have so far reported earnings, 82.7% topped expectations,
while only 12% have disappointed Wall Street, according to
Refinitiv. By comparison, the long-term average of outperformance
since 1994 is 65% and 20% for cooler-than-expected results.
This week sees 130 S&P 500 companies, or a quarter of the
index, expected to report quarterly earnings, and will be the
busiest week for earnings reports this quarter.
"Equities are looking more positively at U.S.-Chinese talks and
the potential of a better than expected earnings season showing
from major names this week," wrote Arnim Holzer, macro strategist
for EAB Investment Group.
Which stocks were in focus?
Shares of Halliburton Co.(HAL)rose 6.4% on Monday
(http://www.marketwatch.com/story/halliburtons-stock-falls-after-profit-matches-expectations-but-revenue-falls-below-2019-10-21),
after the oil-services company reported a third-quarter profit that
was in line with expectations but revenue that fell below, amid
lower pressure pumping activity and reduced drilling and wireline
activity.
Shares of McDermott International Inc.(MDR) fell 13.2%
(http://www.marketwatch.com/story/mcdermotts-stock-rockets-after-new-17-billion-financing-deal-2019-10-21)after
the company announced an agreement on $1.7 billion in new
financing. This comes amid reports that McDermott was in talks to
restructure its balance sheet.
Teva Pharmaceutical Industries Ltd's U.S.-listed stock (TEVA.TV)
climbed 8.7% after several drug companies
(http://www.marketwatch.com/story/teva-shares-jump-about-10-on-news-of-settlement-with-four-states-in-opioid-litigation-2019-10-21)
reached a settlement with two Ohio counties in opioid lawsuits
Apple Inc.'s shares(AAPL)were up after an analyst at Raymond
James
(http://www.marketwatch.com/story/apple-target-price-gets-a-boost-at-raymond-james-on-increased-stability-2019-10-21)raised
its target price for the iPhone manufacturer to $280 a share, from
$250. The stock rose 1.7% Monday.
Shares of Coty Inc. (COTY) rallied 13.4% after the beauty
company said it would explore
(http://www.marketwatch.com/story/coty-to-explore-strategic-options-for-its-professional-beauty-business-shares-rise-2019-10-21)
strategic alternatives for its professional beauty business.
How did other markets perform?
The 10-year Treasury note yield gained 4.7 basis points
(http://www.marketwatch.com/story/treasury-yields-climb-amid-brexit-deal-drama-2019-10-21)
to trade at 1.794%, a four-week high.
West Texas Intermediate crude for November delivery was under
pressure
(http://www.marketwatch.com/story/oil-prices-set-for-second-skid-in-a-row-as-investors-fret-about-crude-demand-2019-10-21),
shedding 47 cents, or 0.9%, to settle at $53.31 a barrel on the New
York Mercantile Exchange.
Gold for December delivery on Comex fell $6 or 0.4% to settle at
$1,488.10 an ounce
(http://www.marketwatch.com/story/silver-prices-rally-16-leaving-gold-in-the-dust-2019-10-21).
The ICE U.S. Dollar Index , which tracks the performance of the
greenback against six major rivals, rose about 0.1% to 97.339.
Global stock-markets were also trading higher at the start of
the week. The Stoxx Europe 600 closed up 0.6% to 394.22. In Asia,
Japan's Topix index gained 0.4% and China's CSI 300 index finished
up 0.3%.
(END) Dow Jones Newswires
October 21, 2019 16:18 ET (20:18 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.