Tuesday, 04 August 2015 22:08
NEW YORK: US equities rose modestly early Tuesday as oil prices rallied and the Chinese stock market notched strong gains following new government measures to counter volatility.
About 40 minutes into trade, the Dow Jones Industrial Average stood at 17,615.53, up 17.33 points (0.10 percent).
The broad-based S&P 500 added 1.84 (0.09 percent) at 2,099.88, while the tech-rich Nasdaq Composite Index gained 7.02 (0.14 percent) at 5,122.40.
Dow member Chevron added 0.7 percent and EOG Resources rose 1.4 percent as oil prices opened higher. Weakness in petroleum-linked equities had been a major factor behind Monday’s drop in US stocks.
The benchmark Shanghai Composite Index jumped 3.7 percent as China announced new rules restricting short selling, lifting a volatile market that has been a source of unease for investors globally.
Briefing.com analyst Patrick O’Hare described sentiment as “lackluster,” attributing the mindset to a mix of mediocre economic data and anemic trading volumes due to summer “vacationitis” in the US.
Biopharmaceutical company Baxalta jumped 12.6 percent after Dublin-based Shire said it had offered to acquire the company for $ 30 billion. Shire fell 4.7 percent.
CVS Health fell 2.3 percent as it projected earnings in the current quarter of $ 1.27-$ 1.30 per share, below the $ 1.37 forecast by Wall Street analysts.
Handbag and accessories retailer Coach jumped 4.4 percent as it reported earnings for the quarter ending June 27 of 31 cents per share, two cents above analyst estimates.
American International Group fell 3.2 percent as net income for the second quarter rose 5.4 percent to $ 1.9 billion. The insurer also hiked its dividend and authorized up to $ 5 billion in new share repurchases, moves that BMO Capital Markets said were intended to compensate for a weak underwriting performance in some businesses.
Allstate, another insurer, sank 10.9 percent as net income fell 46.9 percent to $ 326 million as it cited a rise in auto accidents.
Bond prices fell. The yield on the 10-year US Treasury rose to 2.18 percent from 2.15 percent Monday, while the 30-year advanced to 2.88 percent from 2.86 percent. Bond prices and yields move inversely.
