By Sue Chang and Chris Matthews, MarketWatch
Pinterest soars by double digits on debut
U.S. stocks gained Thursday, with the Dow up more than 100
points, as investors continued to analyze the flow of corporate
earnings and a series of conflicting economic reports, but
sentiment was brightened by strong market debuts from Pinterest
Inc. and Zoom Video Communications Inc.
What are indexes doing?
The Dow Jones Industrial Average rose 142 points, or 0.5%, to
26,592 and the S&P 500 index added 7 points, or 0.3%, to 2,907.
The Nasdaq Composite Index , meanwhile, reversed its earlier drop
to advance 5 points to 8,001.
Stocks are poised to finish the week on a positive note, with
markets scheduled to be closed for the Good Friday holiday
(http://www.marketwatch.com/story/which-markets-are-closed-on-good-friday-2019-04-15).
The S&P 500 was on track for a flat week but the Dow was set to
rise 0.7% and the Nasdaq was on pace to finish 0.2% higher.
What's driving the market?
Investors were deluged with a series of new earnings reports and
data that sent inconsistent messages about the health of the U.S.
and global economies.
The first-quarter earnings outlook has improved somewhat,
according to CFRA, which said consensus estimates now call for a
2.3% fall in first-quarter operating earnings a share. That is up
from the call for a 3% drop ahead of the kickoff of earnings
season, but down from the 4.5% increase projected at the end of
last year. Meanwhile, second-quarter earnings are now forecast to
eke out a 0.3% advance, CFRA said, which would avert an earnings
recession -- commonly defined as consecutive quarters of falling
profit.
Retail sales data showed a rise of 1.6% in March,
(http://www.marketwatch.com/story/retail-sales-post-biggest-gain-in-1-12-years-point-to-rebounding-economy-2019-04-18)
beating consensus estimates. The increase was driven by a 3.5% rise
in auto sales, but even with autos and gas stripped out, sales rose
by 0.9%, after February's 0.4% decline.
IHS Markit said its U.S. composite PMI -- a survey-based measure
of activity in the manufacturing and services sectors -- fell to
52.9 in April from 55.3 in March
(http://www.marketwatch.com/story/ihs-markit-pmi-shows-somewhat-slower-us-economic-growth-in-april-2019-04-18),
a 31-month low.
Analysts noted that market participants have largely ignored
headlines surrounding the Russia investigation and other political
turmoil, but some see scope for a negative reaction if the report
ultimately appears to be less exculpatory of President Donald Trump
and his campaign than characterized by Barr.
New applications for unemployment benefits fell for the fifth
week in a row
(http://www.marketwatch.com/story/jobless-claims-dive-even-lower-to-192000-sit-at-nearly-50-year-low-2019-04-18)
to a near 50-year low of 192,000, below economists expectations of
204,000, per a MarketWatch poll.
The Philadelphia Fed's regional manufacturing index, meanwhile,
fell to a three-year low of 8.5, below economists expectations of
11.
U.S. business inventories rose 0.3% in February, according to
the Commerce Department
(http://www.marketwatch.com/story/us-business-inventories-rise-03-in-february-2019-04-18).
The ratio of inventories to sales remained unchanged at 1.39,
indicating the number of months it would take to sell inventory on
hand.
The Conference Board's Index of Leading Economic Indicators rose
0.4% in March
(http://www.marketwatch.com/story/economy-speeds-up-in-march-but-not-at-a-very-fast-pace-leading-indicators-show-2019-04-18),
indicating a slight uptick in U.S. economic activity from a weak
start to 2019.
The market took the release of Special Counsel Robert Mueller's
report on his investigation into Russian election interference in
stride. The Justice Department provided the Mueller report to
Congress and the public Thursday morning. Portions of the report
are be blacked out.
Live coverage:Mueller report release, Barr press conference
(http://www.marketwatch.com/story/live-coverage-of-mueller-report-release-barr-press-conference-2019-04-18)
What are analysts saying?
"A lot of good news has already been priced in to the market,
and investors are still in search of the next catalyst to drive
stocks higher," said Michael Arone, chief investment strategist at
State Street Global Advisors. "Investors are still fearful of a
global economic slowdown," and want to see a rebound in Europe and
more confirmation that China's economy has bottomed, before markets
can take the next leg higher, he added.
"There's been a lot of turbulence in retail recently so it's
good to see [retail sales data] blow it out of water, and we can
likely thank the tight labor market boosting consumer spending,"
said Mike Loewengart, v.p. of investment strategy at E-Trade
Financial Corp., in an email. "The recent uptick in wages and the
possibility that we're in a sweet spot with inflation could also
continue to drive momentum," he added.
What stocks are in focus?
Pinterest soared 30% on its debut in the market after pricing
its initial public offering higher than expected
(http://www.marketwatch.com/story/pinterest-prices-ipo-at-19-a-share-valuation-tops-10-billion-2019-04-17),
raising more than $1.4 billion and valuing the company at more than
$12 billion.
Zoom Video Communications , which reportedly priced its IPO
above its stated range as well, surged 75%
(http://www.marketwatch.com/story/zoom-stock-soars-75-after-ipo-2019-04-18).
Shares of Philip Morris International Inc.(PM) dropped 0.9%
after the tobacco company beat expectations for first-quarter
earnings and revenue, though issued downbeat guidance
(http://www.marketwatch.com/story/philip-morris-beats-profit-and-revenue-expectations-provides-downbeat-eps-guidance-2019-04-18).
Travelers Cos. (TRV) shares gained 2.9% after the insurer beat
estimates for first-quarter sales and earnings, while raising its
quarterly dividend.
Shares of American Express Co. (AXP) rose 1.8% after the global
payments and credit card company reported a first-quarter adjusted
profit that topped expectations
(http://www.marketwatch.com/story/american-expresss-stock-falls-after-profit-beats-but-revenue-comes-up-shy-2019-04-18),
but revenue that came up shy.
Shares of Alcoa Corp. (AA) fell 4.3% after the alumina and
aluminum producer late Wednesday reported a wider-than-expected
loss
(http://www.marketwatch.com/story/alcoa-stock-slides-on-q1-miss-company-projects-slight-smaller-aluminum-deficit-2019-04-17)
for the first quarter, while also falling short of sales
expectations.
Atlassian Corp. (TEAM) shares sank 8.6% after the software
company issued its earnings outlook which fell short of
expectations.
Shares of Honeywell International Inc. (HON) rose 3.7% after the
aerospace, building technologies and materials company reported
first-quarter earnings and sales that beat expectations, and raised
its full-year outlook.
How are other markets trading?
Stocks in Asia closed on a down note, after Japan's Nikkei lost
0.8%, while Hong Kong's Hang Seng Index fell 0.5% and China's
Shanghai Composite Index retreated 0.4%. European stocks were
trading modestly higher, with the Stoxx Europe 600 rising 0.2%.
In commodities markets, crude oil shook off earlier weakness to
rise
(http://www.marketwatch.com/story/oil-prices-slip-but-cling-to-nearly-5-month-highs-as-supply-clarity-awaited-2019-04-18)
and gold prices settled mostly unchanged
(http://www.marketwatch.com/story/gold-tips-higher-as-stocks-ease-but-hovers-near-2019-low-2019-04-18).
The U.S. dollar , meanwhile, gained value relative to its peers
(http://www.marketwatch.com/story/euro-bruised-as-pmi-data-points-to-further-eurozone-weakness-2019-04-18).
--William Watts contributed to this article
(END) Dow Jones Newswires
April 18, 2019 15:18 ET (19:18 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.