Markets

Mid-Day Update: Stocks Gain Altitude as Trade Tensions Ease, Treasury Yields Prop Up Financials

Led higher by the financial sector in concert with rising Treasury yields, Wall Street's major averages are all in positive territory with the Dow Jones Industrial Average outperforming. Trade concessions from both the US and China fueled early gains putting the Dow Jones Industrial Average back above the 25,000 threshold and the S&P 500 in the plus column for the fourth consecutive day.

After digesting mixed economic data, stocks continued to gain altitude, lifting the Nasdaq to another record high on outsized gains in component stocks Tesla ( TSLA ) and Starbucks ( SBUX ) while the blue chip index was propped up by solid gains in industrial shares like Boeing ( BA ) and DowDuPont ( DWDP ) amid thawing trade tensions between the US and China.

On the economic front, Washington's efforts to address the swelling US trade deficit may be finally bearing fruit as the deficit narrowed for a second straight month by 2.1% to a seven-month low of $46.2 million, below the consensus estimate for a $49.0 billion deficit. The closely watched deficit with China fell to $30.8 billion from $34.2 billion, previously, followed by narrower deficits with the EU, Canada and Mexico.

The good news on the balance of trade was dented by revisions to Q1 nonfarm productivity and unit labor costs. Factory output grew by 0.4%, a measurable revision from the +0.7% initially reported, while wage pressures continue to mount as the unit labor costs component was nudged up to 2.9% from 2.7%.

European stocks were mixed with hawkish rhetoric from members of the European Central Bank regarding its asset purchase program driving up the euro and weighing on most EU-zone assets. The exception was the mining sector, which was trading higher as a result of a 3-month high in copper futures.

Crude oil was down $0.78 to $64.74 per barrel. Natural gas was down $0.01 to $2.88 per 1 million BTU. Gold was up $1.50 to $1,303.80 an ounce, while silver was up $0.20 to $16.74 an ounce. Copper was up $0.06 to $3.26 per pound.

Among energy ETFs, the United States Oil Fund was down 1.02% to $13.08 with the United States Natural Gas Fund was down 0.21% to $23.32. Among precious-metal funds, the Market Vectors Gold Miners ETF was up 0.56% to 22.47 while SPDR Gold Shares were up 0.21% to $123.11. The iShares Silver Trust was up 1.39% to $15.73.

Here's where the markets stand at mid-day:

US MARKETS

NYSE Composite Index was up 75.08 points (+0.59%) to 12,733.67

Dow Jones Industrial Index was up 231.29 points (+0.93%) to 25,031.26

S&P 500 was up 11.30 points (+0.41%) to 2,760.10

Nasdaq Composite Index was up 19.43 points (+ 0.25%) to 7,657.12

GLOBAL SENTIMENT

FTSE 100 was up 25.57 points (+0.33%) to 7,712.37

DAX was up 42.94 points (+0.34%) to 12,830.07

CAC 40 was down 3.39 points (-0.06%) to 5,457.56

Nikkei 225 was up 86.19 points (+0.38%) to 22,625.73

Hang Seng Index was up 165.65 points (+0.53%) to 31,259.10

Shanghai China Composite Index was up 1.48 points (+0.05%) to 3,115.68

NYSE SECTOR INDICES

NYSE Energy Sector Index was up 1.50 points (+0.01%) to 11,957.09

NYSE Financial Sector Index was up 91.24 points (+1.15%) to 8,041.05

NYSE Healthcare Sector Index was up 70.41 points (+0.49%) to 14,534.52

UPSIDE MOVERS

(+) AXON (+123.71%) Acquired worldwide rights to commercialize Parkinson's disease treatment

(+) VBLT (+22.85%) Presented positive data on MOSPD2 program in oncology and inflammation

(+) NCS (+7.99%) Reported better-than-expected Q2 results

(+) SNES (+4.15%) Regained Nasdaq compliance for $1 per share price

DOWNSIDE MOVERS

(-) AMBA (-13.57%) Q1 results down from year ago, Q2 sales guidance set below street expectations

(-) SHLO (-5.12%) Missed Q2 earnings estimates

(-) DAL (-1.65%) May passenger miles down 2.9%

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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