U.S. Stocks Climb as Tech Sector Rallies

Date : 01/22/2020 @ 7:30PM
Source : Dow Jones News
Stock : International Business Machines Corp (IBM)
Quote : 149.84  -1.38 (-0.91%) @ 1:00AM
After Hours
Last Trade
Last $ 150.09 ▲ 0.25 (0.17%)

U.S. Stocks Climb as Tech Sector Rallies

International Business M... (NYSE:IBM)
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By Anna Isaac and Akane Otani 

U.S. stocks climbed toward records Wednesday, boosted by a rally in shares of technology companies.

The Dow Jones Industrial Average advanced 88 points, or 0.3%, to 29281. The S&P 500 added 0.3% and the Nasdaq Composite rose 0.6%, with both indexes on track to close at fresh highs.

Shares of fast-growing technology-driven companies have led the market higher this year, extending a powerful run that lifted many stocks to records in 2019.

The trend showed no sign of abating Wednesday. International Business Machines rose 3.2% after unexpectedly reporting a slight gain in fourth-quarter revenue, ending a streak of declining sales.

Tesla shares advanced 7.1% after a Wedbush analyst boosted his price target for the stock, citing expectations for strong demand for Tesla products in Europe and China. Shares of the electric-car maker have risen 40% this year, lifting the firm's market capitalization above $100 billion.

Apple added 1% following a report that it would take steps to begin assembling a new low-cost iPhone later this year.

Elsewhere, the Stoxx Europe 600 edged down 0.1% after drifting around the flatline for much of the session. Yields on Italian government bonds rose, though, after reports suggested a key member of the country's ruling coalition might step down.

"Investors don't like uncertainty, but that's very much the short-term response," said Florian Hense, economist at Berenberg Bank.

"The issue with Italy is that it's a time bomb. If there's a global recession in the next two-three years, Italy would be a prime candidate for a debt crisis."

Shares of Italian banks fell, with Milan-based Banco BPM dropping 2.8% and UniCredit losing 3.3%.

In Asia, stock indexes chipped away at the prior day's losses after Chinese authorities said hospitals were taking measures to contain the outbreak of a potentially deadly virus.

Authorities are recommending that people not go into or out of Wuhan, the central Chinese city where the virus originated. Ministries and local governments are also arranging refunds on plane and train tickets, banning tourist groups from Wuhan and organizing coverage of medical expenses, analysts at Everbright Sun Hung Kai said in a note.

Investors have a high degree of confidence in the Chinese government's ability to contain the virus, said James Athey, senior investment manager at Aberdeen Standard Investments.

"The global macroeconomic impact of this virus in Asia, based on what we know now, is likely to be very small," Mr. Athey said. "And secondly, irrespective of the macro response, the market has been trained to buy dips and it's done that today."

Hong Kong's Hang Seng Index ended the day 1.3% higher. Japan's Nikkei Stock Average advanced 0.7%, and the Shanghai Composite rose 0.3%.

Write to Anna Isaac at anna.isaac@wsj.com and Akane Otani at akane.otani@wsj.com

 

(END) Dow Jones Newswires

January 22, 2020 14:15 ET (19:15 GMT)

Copyright (c) 2020 Dow Jones & Company, Inc.

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