U.S. Stocks Mostly Higher, Buoyed by Gains in Telecoms and Financial Firms
December 12 2017 - 2:10PM
Dow Jones News
By Michael Wursthorn and David Hodari
-- U.S. stocks rise, led by financials, telecoms
-- European shares move higher, while Asia slides
-- Investors look to central banks
Gains among telecommunications companies and financial firms
pushed the Dow Jones Industrial Average and S&P 500 higher
Tuesday.
The Dow industrials rose 154 points, or 0.6%, to 24540 in recent
trading, while the S&P 500 gained 0.3%. The Nasdaq Composite
fell less than 0.1%.
A mix of corporate news from telecom firms pushed those
companies in the S&P 500 up 2.4%, the biggest gainer of the
broad index's 11 sectors. Meanwhile, shares of financial firms got
a boost from rising government bond yields ahead of the Federal
Reserve's expected interest-rate increase on Wednesday, and
investors continued to track lawmakers' efforts to complete a tax
bill for a vote next week.
"Everything right now comes down to policy," said Eric Wiegand,
senior portfolio manager U.S. Bank Private Wealth Management.
"We'll be watching what [Fed Chairwoman Janet] Yellen might say at
her last press conference and any insights going forward. The other
fixation in Washington is on the tax bill," he added, saying that
he and other investors are "looking for any signs of negotiations
advancing."
Shares of Comcast advanced 1.8% after the cable and programming
firm said it was no longer pursuing an acquisition of media and
entertainment assets from 21st Century Fox.
Meanwhile, Walt Disney's talks to acquire assets from 21st
Century Fox continued and a deal could be announced as soon this
week, The Wall Street Journal reported. Shares of 21st Century Fox,
which shares common ownership with Wall Street Journal parent News
Corp, rose 1.3%, while Disney gained 0.4%.
Verizon also got a boost after it said it struck a deal to show
NFL football games on its mobile network, as well as Yahoo and its
other platforms. Verizon shares climbed 2.5% in recent trading.
Boeing, a big contributor to the Dow's gains this year, climbed
another 2.6% Tuesday, after the aerospace giant said it would boost
its quarterly dividend by 20% and raise its buyback authorization
to $18 billion.
Shares of banks and other financial firms in the S&P 500
rose 1%, as rising government bond yields tend to boost bank
profits. The yield on the benchmark 10-year U.S. Treasury bond rose
to 2.401%, according to Tradeweb, from 2.387% on Monday.
Goldman Sachs Group gained 2.7%, while JP Morgan Chase & Co.
added 1.3%.
Tuesday marked the start of the Federal Open Market Committee's
two-day meeting, with the panel's interest-rate decision due
Wednesday. Data from CME Group showed investors were betting on a
100% probability that the Fed will announce a rate increase.
Fed observers shouldn't expect many surprises in the months
ahead, said Mark Richards, a global multiasset strategist at J.P.
Morgan Asset & Wealth Management. December's meeting will be
the last for multiple FOMC members, and given an impending change
at the helm in January, "it doesn't feel like a new Fed chair will
seek to alter the policy path materially, so we expect [the current
guidance of three increases] to be maintained for a good few
months."
Elsewhere, the Stoxx Europe 600 rose 0.7%, while most indexes in
Asia ended the session lower.
Hong Kong's Hang Seng Index fell 0.6%, dragged lower by
heavyweight Tencent Holdings. The tech company fell 3% after
disclosing that one of its units is in talks to acquire a minority
stake in supermarket operator Yonghui.
South Korea's Kospi slipped 0.4%, despite a 0.6% gain for index
heavyweight Samsung Electronics. Japan's Nikkei closed 0.3% lower,
partly due to a slight drop in the yen against the dollar.
Regional selling also weighed on Chinese stocks, with the
Shanghai Composite down 1.3%.
Write to Michael Wursthorn at Michael.Wursthorn@wsj.com and
David Hodari at David.Hodari@dowjones.com
(END) Dow Jones Newswires
December 12, 2017 13:55 ET (18:55 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.