S&P 500 snaps five-day losing streak, oil extends gains
Stocks climbed Thursday following a choppy morning of trading.
The S&P 500 (^GSPC) rose 1.06%, or 28.67 points as of market close, snapping a five-day losing streak. The Dow (^DJI) advanced 0.83%, or 208.84 points, turning around after a morning of declines. The Nasdaq (^IXIC) rose 1.72%, or 122.64 points.
The S&P 500 was as low as 2,670.75 on Thursday morning. In other words, the index, which closed 2017 at 2,673.61, was briefly negative for the year.
Crude oil prices held onto gains after snapping a 12-day losing streak Wednesday. Prices for US crude (CL=F) rose 0.44% to $56.50 per barrel, while Brent crude (BZ=F) advanced 0.65% to $66.55 per barrel.
Overseas, the Sterling (GBPUSD=X, GBPEUR=X) fell against the dollar after a series of key resignations heightened Brexit uncertainty. The departures included UK Brexit Secretary Dominic Raab and Work and Pensions Secretary Esther McVey, and comes as Prime Minister Theresa May faces increased pressure to win support from the majority of MPs for her draft departure deal with the EU.
ECONOMY: Retail sales increase, jobless claims tick up
Advance estimates for US retail sales increased 0.8% over last month in October, higher than consensus expectations of a 0.5% pace of increase. Retail sales were downwardly revised to see a pace of decrease of 0.1% in September, the Commerce Department said in a statement Thursday.
Excluding gasoline sales, the month-over-month rate of increase for retail sales was 0.5% in October. Excluding auto and gas sales, the increase was 0.3%, slightly below estimates of 0.4%.
Import prices advanced 0.5% month-over-month in October after increasing 0.2% in September, according to data from the US Bureau of Labor Statistics. Import prices increased 3.5% in the 12 months ending in October, outpacing consensus estimates of 3.3%.
The price index for import fuels rose 3.3% in October from 0.7% in September, marking the largest monthly advance since May. Excluding petroleum, import prices increased 0.2% in October, from registering no change in September.
Initial unemployment claims rose by 2,000 to 216,000 for the week ending November 10, the Department of Labor reported Thursday. Consensus expectations were for the economy to add 213,000 new jobless claims for the week, according to Bloomberg data. Continuing jobless claims rose to 1.676 million for the week from 1.63 million.
“Claims have yet to return to the sub-210K pre-Hurricane Florence/Michael trend, and with each passing week it is becoming harder to argue that the storms are still the story. Claims numbers over periods as short as a few weeks can’t be taken seriously, given the difficulties of seasonally adjusting weekly data, but note that the y/y rate this week, -2.5%, was the highest since mid-May,” Ian Shepherdson of Pantheon Macroeconomics wrote in a note. “We see no good reason for a sustained rise in claims unless the trade war steps up another gear, but the downward momentum has drained from these numbers, at least for now.”
STOCKS: Walmart beats Wall Street’s expectations, PG&E extends losses
Walmart (WMT) delivered quarterly earnings that exceeded analyst expectations as a healthy e-commerce business helped buoy the world’s largest retailer. E-commerce sales grew 43% in the quarter. Adjusted earnings were $1.08 per share, versus consensus estimates of $1.01 per share. Comparable store sales excluding fuel grew at a faster-than-expected pace of 3.4%. Net revenue, however, came in at $124.9 billion, missing estimates of $125.49 billion, which the retailer attributed in part to currency headwinds. Walmart raised its guidance for the full-year fiscal 2019 to between $4.75 and $4.85 on an adjusted basis. Despite the upbeat outlook, shares of Walmart fell 1.95% to $99.55 each as of market close.
Meanwhile, peer retailer JCPenney (JCP) missed Wall Street’s expectations on quarterly earnings and revenue. Adjusted losses came in at 38 cents per share, wider than the expected loss of 6 cents, while revenue was $2.76 billion versus $2.86 billion expected. The company’s net loss for the fourth-quarter was $101 million and 32 cents per share, more than twice as much as its losses last year. This is the company’s first earnings report since previous CEO Marvin R. Ellison resigned earlier this year to become top executive at Lowe’s. Shares of JCPenney recovered losses by market close Thursday, climbing 11.48% to $1.36 each.
Tech company Cisco (CSCO) beat on the top and bottom lines for the first quarter of the 2019 fiscal year, the company reported after market close Wednesday. Adjusted earnings were 75 cents per share on revenue of $13.07 billion, versus consensus estimates of 72 cents per share on revenue of $12.87 billion. Cisco also beat expectations on revenue in its Infrastructure Platforms business segment, which brought in $7.64 billion. Chuck Robbins, CEO of the hardware tech company, told CNBC Wednesday that he is “optimistic that we’ll get to some resolution” for the ongoing US-China trade dispute. Cisco reported it had to implement some price increases following the imposition of 10% tariffs on imports from China in the quarter. Shares of Cisco rose 5.5% to $46.77 each as of market close.
Shares of PG&E Corp. (PCG), a West Coast utility, extended losses after plummeting more 21% at the close Wednesday. The company is under investigation as its equipment may have been a cause of the devastating Camp Fire in California. PG&E said that if it’s found responsible, its liability would surpass its insurance coverage. PG&E said it has $3.46 billion in cash on its balance sheet along with $1.4 billion in wildfire insurance coverage, however, damages from the fire could increase to $15 billion, according to Citigroup estimates. Shares of PG&E fell 30.72% to $17.73 as of market close.
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Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck
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