U.S. Stocks End Month Higher, Buoyed by Earnings
April 28 2017 - 5:16PM
Dow Jones News
By Corrie Driebusch and Mike Bird
U.S. stocks ended the month higher, boosted by strong corporate
earnings.
The S&P 500 now sits about half a percentage point from
all-time highs.
With nearly 60% of the companies in the S&P 500 having
reported, first-quarter earnings are on track to rise 12.5% from
the year prior, according to FactSet. That's above the
first-quarter earnings growth of 9.1% that analysts estimated as of
March 31.
On Friday, shares of Chevron and Exxon Mobil climbed after the
companies posted encouraging results. Exxon's shares rose 39 cents,
or 0.5%, to $81.65 after the oil and gas giant said its profit more
than doubled in the first quarter, while Chevron's stock gained
1.23, or 1.2%, to 106.70 after the company swung to a profit in the
first three months of the year.
Amazon.com's stock rose 6.61, or 0.7%, to 924.99, a new record,
after the company posted a bigger-than-expected increase in profit
late Thursday.
Earlier in the week, Biogen shares gained 3.6% Tuesday after the
biotech company's earnings topped analyst estimates and McDonald's
stock climbed 5.6% after the burger giant reported
better-than-expected sales in the first quarter.
The S&P 500 ended the week up 1.5%, putting its April gains
at 0.9%. The index slipped 4.57 points, or 0.2%, to 2384.20
Friday.
The Dow Jones Industrial Average edged down 40.82 points, or
0.2%, to 20940.51 Friday.
Friday's declines followed data showing the U.S. economy
stumbled in the first quarter.
Gross domestic product rose 0.7% at a seasonally adjusted annual
rate, the Commerce Department said, falling short of the 1% growth
expected by economists surveyed by The Wall Street Journal.
However, it exceeded the Federal Reserve Bank of Atlanta's widely
tracked GDPNow model, which on Thursday forecast 0.2% growth for
the first quarter.
There were other positive signals in the data. U.S. wages and
benefits rose at the fastest pace since 2007 during the first
quarter, signaling a tightening labor market. The Fed's preferred
inflation gauge also rose at a rate of 2.4% in the first quarter,
its biggest jump since spring 2011.
Still, some analysts said they were concerned with the GDP
number and what it could mean.
"We need greater growth," said Kent Engelke, chief economic
strategist at Capitol Securities Management. If inflation and slow
growth continue together, it would "be something to worry about
because it could hurt corporate profits."
The yield on the 10-year Treasury note fell to 2.282%, compared
with 2.298% Thursday. In April, yields declined 0.114 percentage
point.
Earlier, the euro and government bond yields jumped on
surprisingly strong eurozone inflation figures. The Stoxx Europe
600 index slipped 0.2%.
Despite the cooling in European stocks toward the end of the
week, the Stoxx Europe 600 rose 1.6% in April, its third
consecutive month of gains. In the week ended April 26, European
equity funds recorded their strongest inflows in more than a year,
according to EPFR Global data.
In Asia, Japan's Nikkei 225 index closed down 0.3% on Friday,
though it ended the month up 1.5%.
Write to Corrie Driebusch at corrie.driebusch@wsj.com and Mike
Bird at Mike.Bird@wsj.com
(END) Dow Jones Newswires
April 28, 2017 17:01 ET (21:01 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.