The Dow rose more than 100 points, despite heading toward declines earlier in the day. Intel, 3M, and Caterpillar rallied, offsetting losses from Boeing. The DJIA is on track to rise for the week. The Dow snapped out of its early-morning doldrums to mount a…
The Dow snapped out of its early-morning doldrums to mount a triple-digit advance, and the stock market bellwether is now on track to end the week on a high note.
Boeing stock weighed on the index, but fantastic earnings from Intel offset the negative sentiment.
Further bolstering the recovery, investors gave two beleaguered Dow 30 components a second look.
The Dow Jones Industrial Average fell at the opening bell, but by late morning the index had erased those losses and added more than 175 points for good measure. At last check, the DJIA had bounced 177.76 points or 0.66%, bringing it to 26,983.29.
The index had tumbled as low as 26,765.68 in early-morning trading.
The Dow outpaced the S&P 500 (+0.48%) and Nasdaq (0.64%), both of which had to overcome disappointing quarterly results from Amazon. However, AMZN shares pared most of their initial losses, allowing the two indices to assemble moderate gains.
The Dow’s intraday recovery was particularly impressive because Boeing – the DJIA’s most heavily weighted component – fell more than 1.2%.
The stock appeared to be responding to the publication of Indonesia’s official Lion Air 737 Max crash report, which blamed design flaws in the airplane, as well as “deficiencies” in cockpit systems, for the deaths of 189 people in October 2018. The report did not drop any bombshells, but it did provide investors with yet another reminder that the company’s most popular jet faces an uphill battle to return to service.
One of the Dow’s smallest components, Intel (+7.29%), brightened the mood with a spectacular earnings report. Bucking a trend among its peers, the chipmaker raised its full-year revenue outlook to $71 billion. The firm also hiked its full-year earnings outlook after beating analyst estimates for Q3 by 15%.
Ranking second and third among DJIA companies were 3M (+3.19%) and Caterpillar (+3.15%), two firms who disappointed investors when they reported earnings earlier in the week.
Both companies blamed the trade war for falling earnings guidance, but they received a boost this morning courtesy of a healthy dose of US-China optimism.
Adding to an already bullish mood, the Office of the US Trade Representative published a statement revealing that the US and China are “close to finalizing some sections” of the “phase one” trade agreement produced from top-level negotiations earlier this month.
One day earlier, Vice President Mike Pence had warned China that it would reconsider signing a trade deal if the government used violence to clamp down on the festering Hong Kong protests. Pence’s hawkish speech triggered a sharp rebuke from Beijing, who accused him of “arrogance and hypocrisy,” not to mention “lies.”
This article was edited by Sam Bourgi.
Last modified: January 10, 2020 3:29 PM UTC