Strong quarterly earnings by Visa, Verizon and Intel helped the benchmarks end in the green on Friday. Rising optimism on the U.S.-China trade front also boosted investors’ sentiment.
The Dow Jones Industrial Average (DJI) gained 0.6% or 152.53 points to close at 26,958.06. The S&P 500 rose 0.4% or 12.26 points to close at 3,022.55. Meanwhile, the Nasdaq Composite Index closed at 8,243.12, increasing 0.7% or 57.32 points. The fear-gauge CBOE Volatility Index (VIX) decreased 8.4% to close at 12.65. A total of 6.29 billion shares were traded Friday, lower than the last 20-session average of 6.46 billion. Advancers outnumbered decliners on the NYSE by a 1.14-to-1 ratio. On Nasdaq, a 1.50-to-1 ratio favored advancing issues.
How Did The Benchmarks Perform?
The S&P 500 posted 39 new 52-week highs and two new lows and the Nasdaq Composite recorded 83 new highs and 59 new lows. The S&P 500 closed 0.1% away from its record close of 3,025.86 on July 26, 2019, its second-highest close in history.
Strong Quarterly Earnings
Several companies have already reported third-quarter earnings and majority of them have come up with better-than-expected results. More than 120 companies reported earnings this week and on Friday Visa Inc. V, Verizon Communications Inc. VZ and Intel Corporation INTC reported earnings that beats the Zacks Consensus Estimate.
Visa reported fourth-quarter and fiscal 2019 earnings of $1.47 per share, beating the Zacks Consensus Estimate by 2.8%. The results were driven by growth in payments volume, cross-border volume and processed transactions. (Read More)
Verizon reported third-quarter earnings result of $1.25 per share beating Zacks Consensus Estimate by a penny. The results were boosted by increased 5G deployment across the country under the new operational framework. (Read More)
Intel reported third-quarter earnings of $1.42 per share, beating the Zacks Consensus Estimate of $1.24 per share. The company’s processors for desktop PCs, laptops and two-in-one devices segment has performed well. (Read More)
Shares of Intel that flaunts a Zacks Rank #1 (Strong Buy) rose 8.1% on Oct 25. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Progress on U.S.-China Trade Front
On Oct 25, the United States and China made progress on the trade front; they have come close to complete parts of the phase one deal. China will be purchasing more U.S. farm products, only after China’s request for cancellation of some U.S. tariffs on Chinese imports is accepted.
The Office of the U.S. Trade Representative reported on Oct 25, that both the countries have made “headway on specific issues” and deputy level talks will continue, while “the principals will have another call in the near future.” This boosted investors’ sentiment and send major benchmarks to their highs on Friday.
Per University of Michigan’s Surveys of Consumers consumer sentiment dipped slightly in October to 95.5 but was higher than September’s final print of 93.2. On the other hands, the U.S. government ran a budget deficit of $984 billion in the fiscal year ending in September. It is the largest shortfall since 2012 and 26% more than the fiscal 2018 deficit of $779 billion.
The major benchmarks posted weekly gains, with the Dow, The S&P 50 and the Nasdaq up 0.8%, 1.3% and 1.8%, respectively. Benchmarks went through a roller-coaster ride driven by the uncertainties regarding Brexit, U.S-China trade deal and weak economic data, however investors’ sentiment remained elevated with majority companies reporting better-than-expected third-quarter earnings.
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Click to get this free report Verizon Communications Inc. (VZ) : Free Stock Analysis Report Intel Corporation (INTC) : Free Stock Analysis Report Visa Inc. (V) : Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research