Earning reports and economic data boost stocks
US stocks closed modestly higher on Tuesday, 22 July 2014, boosted by better-than-expected inflation and housing reports as well as a flood of second-quarter earnings reports. Although geopolitical concerns factored into the modest retreat on Monday, the worries were cast aside today after separatist forces in eastern Ukraine handed over black boxes from MH17 to Malaysian authorities and Secretary of State John Kerry began working on brokering a cease fire in Gaza.
The Dow Jones Industrial Average added 61.81 points, or 0.4%, to 17,113.54. The Nasdaq Composite gained 31.31 points, or 0.7%, to 4,456.02. The S&P 500 ended the session 9.93 points, or 0.5%, higher at 1,983.56.
The S&P was led by stellar results from Chipotle Mexican Grill. The benchmark index closed within a striking distance from its record closing level.
Six Dow Industrials components reported ahead of the market open. Coca-Cola shares fell 2.9% after the beverage giant reported second-quarter sales that fell short of forecasts, while profit topped estimates. McDonald's shares dropped 1.3% after the fast-food restaurant chain reported earnings that came in below expectations.
Economic data for the day included CPI, FHFA Housing Price Index, and Existing Home Sales. Consumer prices increased 0.3% in June, down from a 0.4% increase in May, which matched the consensus estimate. As expected from the June PPI report, a strong increase in energy prices, up 1.6% in June, was the main catalyst for the overall increase in consumer prices. That was the largest increase in monthly energy costs since December.
Excluding food and energy, core CPI increased 0.1% in June after increasing 0.3% in May, while the consensus expected an increase of 0.2%.
Also Read
The May Housing Price Index from the FHFA rose 0.4%, which followed a revised increase of 0.1% observed during the prior month (from 0.0%).
Existing home sales increased to 5.04 million SAAR in June from an upwardly revised 4.91 million SAAR (from 4.89 million SAAR) in May, while the consensus an increase to 5.00 million SAAR. This was the first time sales exceeded 5.00 million SAAR since October 2013. Still, sales are down 2.3% year-over-year.
A firmer U.S. dollar index on Tuesday, in which prices hit a five-week high, was also bearish for the precious metals markets. There was a bit more investor and trader risk appetite in the market place Tuesday, as U.S. and some other major world stock indexes traded higher. However, geopolitics remains on the front burner of the market place. Tensions in Israel and Ukraine remain high.
Gold prices ended the U.S. day session moderately lower Tuesday, 22 July 2014 on some profit-taking. Gold prices declined on Tuesday amid what's shaping up to be a decent earnings season, dampening safe-haven demand that had emerged on the back of developments in Ukraine and the Gaza Strip.
Gold for August delivery shed $7.60 to settle at $1,306.30 an ounce. September silver closed flat at $21 an ounce.
Crude-oil futures ended lower at Nymex on Tuesday, 22 July 2014 coming off a three-week high ahead of weekly supply reports.
Light, sweet crude futures for August delivery fell 17 cents, or 0.2%, to settle at $104.42 a barrel on the New York Mercantile Exchange.
Participation was on the light side with less than 600 million shares changing hands at the NYSE.
Tomorrow, the weekly MBA Mortgage Index will be released at 7:00 ET. On the earnings front, participants will be reacting to results from Apple, Boeing and Microsoft among others.
Powered by Capital Market - Live News