US stocks rise, recover roughly half of Fridays wipeout
New York, Aug 4 (AP) US stocks are recovering some of their sharp losses from last week, when worries about how President Donald Trump's tariffs may be punishing the economy sent a shudder through Wall Street.
The S&P 500 rose 0.8 per cent in early trading to claw back roughly half of Friday's drop. The Dow Jones Industrial Average was up 310 points, or 0.7 per cent, as of 9:35 a.m. Eastern time, and the Nasdaq composite was 1.2 per cent higher.
Wayfair helped lead the way with a 12.3 per cent jump after the retailer of furniture and home decor said accelerating growth helped it make more in profit and revenue during the spring than analysts expected.
Tyson Foods also delivered a bigger profit for the latest quarter than analysts expected, and the company behind the Jimmy Dean and Hillshire Farms brands climbed 3.8 per cent.
They helped offset a 7.1 per cent drop for On Semiconductor, which only matched analysts' expectations for profit in the latest quarter. The company, which sells to the auto and industrial industries, said it's beginning to see 'signs of stabilisation" across its customers.
The pressure is on US companies to deliver bigger profits after their stock prices shot to record after record recently. The jump in stock prices from a low point in April raised criticism that the broad market had become too expensive.
Stocks just sank to their worst week since April not so much on that criticism but on worries that Trump's tariffs may be hitting the US economy following a longer wait than several economists had expected. Job growth slowed sharply last month, and the unemployment rate worsened to 4.2 per cent.
Trump reacted to the disappointing jobs numbers by firing the person in charge of compiling them. He also continued his criticism of the Federal Reserve, which could lower interest rates in an effort to shoot adrenaline into the economy.
The Fed has instead been keeping rates on pause this year, in part because lower rates can send inflation higher, and Trump's tariffs may be set to increase prices for US households.
Friday's stunningly weak jobs report did raise expectations on Wall Street that the Fed may have to cut interest rates at its next meeting in September. That caused Treasury yields to slump in the bond market, and they were mixed on Monday.
The yield on the 10-year Treasury eased to 4.21 per cent from 4.23 per cent late Friday.
The two-year yield, which moves more closely with expectations for Fed action, edged up to to 3.70 per cent from 3.69 per cent.
This upcoming week may have less fireworks on Wall Street following last week's jobs report, big economic updates and profit reports from several of the US stock market's most influential companies.
The highlights include earnings updates from The Walt Disney Co., McDonald's and Caterpillar, along with updates on US business activity.
On Wall Street, Boeing slipped 0.8 per cent after workers who build fighter jets for the troubled aerospace giant went on strike overnight.
About 3,200 workers at Boeing facilities in the Midwest voted to reject a modified four-year labour agreement with company, their union said. The vote followed members' rejection last week of an earlier proposal from the troubled aerospace giant which had included a 20 per cent wage increase over four years.
Berkshire Hathaway fell 3.2 per cent after Warren Buffett's company reported less than half as much profit in the second quarter from a year earlier in large part because it wrote down the value of its investment in Kraft Heinz.
Tesla rose 2.5 per cent after awarding CEO Elon Musk 96 million shares of restricted stock valued at approximately USD 29 billion. The move, which comes just six months after a judge ordered the company to revoke his massive pay package, could remove potential worries that Musk may leave the company.
In stock markets abroad, indexes rose across much of Europe and Asia.
South Korea's Kospi rose 0.9 per cent, and France's CAC 40 climbed 1 per cent, while Japan's Nikkei 225 was an outlier with a drop of 1.2 per cent. (AP) GRS GRS
(This story has not been edited by News18 staff and is published from a syndicated news agency feed - PTI) view comments
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