Published: Sun, April 29, 2018
Markets | By Terence Owen

Dow opens slightly higher on industrial gains

Dow opens slightly higher on industrial gains

USA stock indexes swung between gains and losses on Wednesday, as Boeing's jump after upbeat results and outlook was negated by declines in technology stocks and rising US bond yields.

The Dow Jones Industrial Average added 0.3 percent to close the session at 24,083.83.

The S&P 500 gained 0.2 per cent, while the Nasdaq closed slightly below breakeven point. The Nasdaq Composite fell 121.25 points, or 1.7 percent, to 7007.35.

There were some upbeat quarterly earnings from major companies, but that was dampened by the market's concerns over rising bond yields and borrowing costs. Shares sold off after the company warned revenue growth would slow in the second half of the year. The worries began to set in after construction and mining equipment maker Caterpillar said it doesn't expect to top its first-quarter profit for the rest of this year. On Wednesday Goodyear Tire & Rubber said higher raw materials costs and weaker demand hurt its business in the first quarter.

With the 10-year yield hitting the mark of 3 percent, the financial markets all around the globe have fallen rapidly with European and Asian indexes trading on Wednesday.

Industrial and basic materials companies and technology firms took some of the worst losses.

The aerospace company topped Wall Street's estimates in the first quarter and raised its forecasts for the year.

Investors expected strong profit growth this year thanks to the growing global economy and tax cuts President Trump signed last year.

P&G Acquires Merck KGaA Darmstadt Germany
But the deal does not yet include Merck's French consumer health business, although P&G has made a binding offer for this. For the full year 2017, net sales of the Consumer Health business amounted to Euro 911 million (USD$1.1 billion).

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A 14-month investigation into alleged Russian meddling in USA affairs by the House Intelligence Committee is wrapping up. The House panel did find that Russian Federation sought to sow discord in the USA through cyberattacks and social media.

Trump may Send Envoy to Talk Trade
Each has proposed imposing tariffs of $50 billion on each other's products; President Donald Trump is looking to impose tariffs up to $100 billion more on Chinese goods.

Gina Martin Adams, chief equity strategist for Bloomberg Intelligence, said it hasn't happened yet. It shed 1.4 percent to $67.70 a barrel in NY the previous day.

The Dow is down 695.09 points, or 2.8 percent. The stock market had already been spooked by a climb in bond yields earlier in the year, sliding sharply in February.

"Fears of "peak earnings" are laughable considering that the average constituent in the S&P 500 has enjoyed year-over-year bottom line growth in excess of 20%", Klein wrote in a note.

The S&P 500 index lost 11 points, or 0.4 percent, to 2,623.

The 10-year Treasury note's yield exceeded 3% on Wednesday, reaching its highest level since 2013. The stock tumbled nearly 4% Tuesday after higher expenses at Google parent Alphabet raised concerns about profitability for the tech titans.

The Nasdaq is down 138.77 points, or 1.9 percent.

Japan's benchmark Nikkei 225 slipped 0.3 percent to 22,206.51 and Hong Kong's Hang Seng lost 0.8 percent to 30,378.89. The market had a slight uptick from mid-day as the stock exchange was reporting the Dow was down at least 600 points at one point.

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