Stocks Mixed to Start Week 07/16 10:00
U.S. stocks are mixed Monday morning as banks rise along with interest rates
but energy companies sink along with the price of oil.
NEW YORK (AP) -- U.S. stocks are mixed Monday morning as banks rise along
with interest rates but energy companies sink along with the price of oil.
Stocks finished at five-month highs last week as investors remained optimistic
about the U.S. economy even as they worried about the trade war between the
U.S. and China as well as other tensions.
KEEPING SCORE: The S&P 500 index lost 2 points, or 0.1 percent, to 2,799 as
of 10 a.m. Eastern time. The Dow Jones Industrial Average was little changed at
25,015. The Nasdaq composite added less than 1 point to 7,826. The Russell 2000
index of smaller-company stocks lost 4 points, or 0.3 percent, to 1,682.
BANK ON IT: Bank of America's second-quarter profits jumped 33 percent. Like
other big banks, it got a big boost from the corporate tax cut that passed at
the end of 2017 and from higher interest rates. Bank of America has also been
cutting expenses. Its profit and revenue were both better than analysts
expected and the stock rose 1.6 percent to $29.
Troubled German lender Deutsche Bank jumped 8 percent to $12.14 after it
said its earnings will be considerably higher than expected. Deutsche Bank has
taken three years of losses based on high costs and big fines and penalties
linked to past misconduct. It replaced its CEO in April.
Banks were also helped by an increase in interest rates after the Commerce
Department said sales at retailers and restaurants kept rising in June. That's
a sign shoppers are still willing to spend even though wages are only growing
slightly, and it's a hint the Federal Reserve will likely continue to raise
Bond prices fell. The yield on the 10-year Treasury note rose to 2.86
percent from 2.83 percent.
CHINA GROWTH: The Chinese government said economic growth slowed a bit over
the last three months. That wasn't a surprise, and the quarter ended before the
U.S. and China formally placed tariffs on billions of dollars in imports. But
it adds to challenges for the world's second-largest economy as the trade
conflict heats up.
China also said it filed a World Trade Organization challenge to the tariff
hike President Donald Trump has proposed on $200 billion in Chinese goods.
ALUMINUM SHINING: Arconic, a company that makes aluminum parts for companies
in the aerospace and automobile industries, soared after the Wall Street
Journal reported that private equity firms are interested in buying it. The
stock climbed 11.5 percent to $19.38, which gave Arconic a market value of
about $9.4 billion.
When Arconic split from former parent Alcoa in late 2016, investors saw it
as a faster-growing business whose stock would probably climb faster than
Alcoa's. That hasn't happened, as Alcoa stock has slowly risen after years of
struggles, and Arconic has fallen more than 40 percent since mid-January.
ENERGY: Benchmark U.S. crude fell 2.7 percent to $69.11 in New York. Brent
crude, used to price international oils, fell 2.8 percent to $73.21 a barrel in
DATA DUMPED: Alliance Data Systems, which manages loyalty and rewards
programs for retailers, fell 6.7 percent to $227.21 after it said late and
delinquent payments increased in the second quarter.
OVERSEAS: Germany's DAX rose 0.2 percent while the CAC 40 in France was down
0.2 percent. The FTSE 100 index in Britain dropped 1 percent. Hong Kong's Hang
Seng edged 0.1 percent higher and the Kospi in South Korea fell 0.4 percent.
CURRENCY: The dollar rose to 112.34 yen from 112.30 yen. The euro climbed to
$1.1717 from $1.1677.