MARKET SNAPSHOT: Stocks Close Higher With S&P 500 Up 17% For Year To Date Ahead Of U.S.

By Chris Matthews and Mark DeCambre, MarketWatch

All eyes on G-20 meeting

Stocks closed higher on Friday, led by banks after the Federal Reserve's second round of stress test results late Thursday, but investors remain focused on the planned meeting on trade issues between President Donald Trump and Chinese President Xi Jinping at the G-20 meeting in Japan Friday night New York time.

Friday also marks a rebalancing of the FTSE Russell index (http://www.marketwatch.com/story/russell-rebalance-large-us-companies-are-getting-bigger-while-the-small-wither-away-2019-06-27), of mostly small capitalization stocks, which will occur at the close of trade.

J.P. Morgan Chase (JPM) rise 2.72%, Morgan Stanley (MS) was up 0.74%, Citigroup (C) 2.76% and Wells Fargo (WFC) 2.23%. All 18 banks past the Federal Reserve stress tests, including Deutsche Bank AG (DBK.XE) which had earlier failed, and many of the largest lenders in the U.S. announced increased payouts to shareholders in the wake of the results.

The total payouts to bank shareholders from dividends and buybacks will hit $173 billion, a record high amount for the group. Goldman (GS) raised its dividend by nearly 50% and its stock ended up 2.65%.

But Wall Street's gains were restrained as investors awaited the Trump-Xi trade meeting scheduled for Saturday Japan time. The Chinese Ministry of Commerce has called on Washington to cancel its import tariffs and sanctions measures on Huawei and other Chinese companies, while Trump has reiterated a threat to impose tariffs on the remaining $300 billion of Chinese imports if talks fail.

"There's a lot of uncertainty as to what the meeting, due to place on Saturday (02.30 GMT), will produce, but the minimum outcome that traders are anticipating is for the two sides to restart the stalled trade negotiations and delay imposing any additional tariffs," wrote Raffi Boyadjian, senior investment analyst at brokerage XM, in a daily research note. .

How are the major benchmarks faring?

The Dow Jones Industrial Average closed up 0.27%, at 26,599 while the S&P 500 index rose 0.6% at 2,941, while the Nasdaq Composite was up 0.5% at 8,006.

On the final trading day of the month and quarter, the Dow is up about 6% for the month and 14% for the year to date, while the S&P 500 is up 6.5% for the month, and 17% for the year.

June's gains came after the Fed opened the door for easier monetary policy later this year. The Fed said earlier this month it will "act as appropriate" to maintain the current economic expansion. This lifted market expectations for a July rate cut.

In U.S. economic data Friday, the Commerce Department reported (http://www.marketwatch.com/story/consumers-boost-spending-in-may-as-incomes-rise-and-inflation-stays-low-2019-06-28) U.S. consumer spending rose 0.4% in May, while personal incomes rose 0.5% during the same period. Economists polled by MarketWatch had expected gains of 0.3% and 0.5%, respectively.

The Federal Reserve's most closely watched measure of inflation, the PCE index, showed yearly inflation falling from 1.6% in April to 1.5% in May, potentially supporting the argument for the Fed to lower interest rates in the coming months, as it attempts to bring inflation to its 2% annual goal.

The University of Michigan released its final reading of consumer confidence for the month of June, with its index coming in at 98.2, above the 98 expected by economists polled by MarketWatch, though off the 100 level seen in May, which was the highest reading in eight months.

Read:The Dow is now on pace for its best June return in 80 years (http://www.marketwatch.com/story/the-dow-is-now-on-pace-for-its-best-june-return-in-80-years-but-the-fed-could-change-that-in-a-heartbeat-2019-06-18)

Read: G-20 preview: Facing faltering economies, Trump and Xi likely to agree to a cease-fire of trade war (http://www.marketwatch.com/story/g-20-preview-facing-faltering-economies-trump-and-xi-likely-to-agree-to-a-cease-fire-of-trade-war-2019-06-26)

Check out:Trump pushes allies on trade, says his talk with Putin at G-20 'is none of your business' (http://www.marketwatch.com/story/trump-says-hell-talk-to-putin-at-g-20-but-what-they-say-is-none-of-your-business-2019-06-27)

Which stocks are in focus?

Apple Inc.'s stock (AAPL) closed off 0.9% after design legend Jony Ive said he was leaving (http://www.marketwatch.com/story/legendary-designer-jony-ive-to-leave-apple-after-27-years-2019-06-27)the iPhone maker to start his own venture.

Boeing Co. shares (BA) ended unchanged after losing 2.9% Thursday on news that the company's 737 MAX fleet, which has been grounded since March after two fatal crashes, could take much longer to receive regulatory clearance to bring the jets back online.

Fellow Dow constituent, UnitedHealth Group Inc. (UNH) said Friday (http://www.marketwatch.com/story/unitedhealth-names-optum-coo-dirk-mcmahon-as-new-ceo-2019-06-28-791242) that it named Dirk McMahon, currently president and chief operating officer of its Optum platform as its new chief executive. Shares slipped 0.97% Friday.

How are other markets trading?

The 10-year Treasury note yield , fell 5.1 basis point from Thursday's close to 1.998%. For the quarter, yields on 10-year paper notched their largest quarterly decline since March 2016, according to Dow Jones Market data.

In commodities markets, August West Texas Intermediate crude lost 1.6% to settle at $58.47 a barrel. Month to date, prices climbed 9.3%, according to Dow Jones Market Data.

August gold rose 0.1%, to settle at $1,413.70 an ounce after seeing a six year high at $1,418.70 for a most active contract on Tuesday.

(END) Dow Jones Newswires

June 28, 2019 16:10 ET (20:10 GMT)

Citigroup (NYSE:C)
Historical Stock Chart
From Mar 2024 to Apr 2024