Stock Market News For Jul 26, 2018

U.S. stocks ended sharply higher on Wednesday recovering from a stiff fall in early trading hours, following President Donald Trump's statement that he has secured some concessions regarding bilateral trade between the United States and the European Union. Trump's statement has reduced trade-related tensions between the United States and some of its major trading partners and closest political allies to a great extent. Investors also applauded the news which enabled all three major stock market indexes to close in the green.

The Dow Jones Industrial Average (DJI) closed at 25,414.10, increasing 0.7% or 172.16 points. The S&P 500 Index (INX) gained 0.9% to close at 2,846.07. Likewise, the Nasdaq Composite Index (IXIC) closed at 7,932.24, advancing 1.2%. A total of 6.61 billion shares were traded on Wednesday, higher than the last 20-session average of 6.09 billion shares. Advancers outnumbered decliners on the NYSE by 1.84-to-1 ratio. On the Nasdaq, advancers had an edge over decliners by 1.31-to-1 ratio. The CBOE VIX decreased 1% to close at 12.29.

How Did the Benchmarks Perform?

The Dow gained 0.7%, marking its second winning close, recovering from a decline of more than 100 points in the early trading hours. Notably, 25 components of the 30-stock blue-chip index closed in the green, while only 5 traded in the red.

The S&P 500 rose 0.9% enabling the benchmark index to exit the correction territory in which it entered on Feb 8. The index's gain was led by a 1.5% increase in Industrials Select Sector SPDR (XLI), 1.3% gain in Health Care Select Sector SPDR (XLV) and Technology Select Sector SPDR (XLK). Notably, the broad-market index closed at its highest since Jan 29. All 11 sectors of the S&P 500 ended in positive territory.

The tech-laden Nasdaq Composite increased 1.2% and ended with a fresh high, its 25th all-time high in 2018.

U.S. - EU Trade Tensions Ease

The ongoing trade conflict between the United States and the European Union has showed signs of easing on Jul 26 following a meeting in White House between President Trump and the European Commission President Jean-Claude Juncker.

Although the details of the meeting are still not available, President Trump stated afterward that the United States and the European Union will maintain a "close relationship" with "strong trade relations." The EU will increase liquefied natural gas and soybean imports from the United States. Both sides have also agreed to lower tariffs on industrial goods.

Trump also stated that both United States and EU would "work together toward zero tariffs, zero non-tariff barriers, zero subsidies on non-auto industrial goods." Moreover, both sides are also working to reach an agreement to avoid increasing tariffs on European auto exports to the United States.

Notably, before the meeting, Trump has threatened the EU that his administration may hike tariffs on EU auto imports from 2.5% to 25% if his meeting with Jean-Claude Juncker fails to deliver fruitful results.

Economic Data

The U.S. Census Bureau and the U.S. Department of Housing and Urban Development jointly reported that in June, 631,000 new homes were sold in the United States well below the consensus estimate of 668,000.

The U.S. Energy Information Administration (EIA) reported that U.S. crude inventories fell 6.1 million barrels for the week ended Jul 20. The U.S. domestic crude inventories fell to their lowest since February 2015.

Stocks That Made Headlines

Norfolk Southern Beats Q2 Earnings & Revenues, Up Y/Y

Norfolk Southern Corp. NSC reported second-quarter 2018 earnings of $2.50 per share, surpassing the Zacks Consensus Estimate of $2.31. ( Read More )

Ryder Q2 Earnings & Revenues Top Estimates, Increase Y/Y

Ryder System, Inc.'s R second-quarter 2018 adjusted earnings of $1.42 per share surpassed the Zacks Consensus Estimate of $1.29. ( Read More )

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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.

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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