The U.S. flag flies over the side entrance to the New York Stock Exchange in New York Tuesday, July 18, 2023. Stocks of several financial titans are leading Wall Street higher Tuesday following some mixed reports on the economy. (AP Photo/J. David Ake)
NEW YORK (AP) – Stocks are opening higher on Wall Street, adding to a run that has pulled the market to its highest level in more than 15 months. The S&P 500 rose 0.4% early Wednesday. The Dow added 168 points, or 0.5% and the Nasdaq composite rose 0.3%. Carvana soared 21% after the used-car dealer agreed with its lenders to reduce its debt by $1.2 billion. Elevance Health jumepd 7.5% after reporting stronger results than analysts expected. Stocks also got some help from easing pressure from the bond market, where yields fell after a report showed U.K. inflation slowed.
THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.
Wall Street shifted between small gains and losses Wednesday as earnings season kicks into high gear.
Futures for the S&P 500 and for the Dow Jones Industrial Average each inched up less than 0.1% before the opening bell.
Carvana shares jumped more than 24% in premarket trading after the online car dealer said it secured a deal to refinance its debt. It also reported that its profit per car nearly doubled from a year ago and it issued an optimistic forecast.
Tesla, Netflix and United Airlines report quarterly results after the bell.
The financial performance of some of the country’s biggest corporations has been surprisingly strong, though the bar was lowered heading into the second quarter with expectations that the slowing economy would squeeze margins and profits.
Whether or not a recession is imminent is still up for debate, but on Tuesday Treasury Secretary Janet Yellen said during an interview with Bloomberg TV in India during a meeting of Group of 20 finance officials that she does not expect a recession, citing the incredibly resilient U.S. job market.
Also, despite elevated prices, Americans continue to spend, and consumer spending is the dominant force in the U.S. economy.
If the Fed does follow through on expectations and raises the federal funds rate next week to a range of 5.25% to 5.50%, it would be at its highest level since 2001. That would be up from its record low of nearly zero early last year.
But inflation has been slowing over the last year, and hopes are high on Wall Street that it will continue cooling enough to get the Fed to stop raising rates and perhaps begin cutting them next year.
In Europe, Britain reported inflation fell to 7.9% in June, a 15-month low. Economists had forecast inflation would decline to 8.2%, but it did better than that thanks to falling fuel prices and milder food price increases.
It’s a relief for struggling consumers and is a further welcome sign that upward price pressures are abating. That has raised hopes among investors that central banks might begin winding down the latest cycle of interest rate hikes.
Britain’s FTSE 100 advanced 0.6% at midday, Germany’s DAX was off 0.1% and in Paris the CAC40 gained 0.3%.
In Asian trading, Hong Kong’s Hang Seng index fell 0.3% to 18,952.31, partly due to selling of property shares after troubled developer China Evergrande reported its total debts rose in the past two years to about $340 billion.
The Shanghai Composite index closed flat at 3,198.84.
The property market, a major driver of growth in China, has languished after regulators reined in lending to try to bring debt in the industry under control
In Tokyo, the Nikkei 225 gained 1.2% to 32,896.03 while the Kospi in Seoul was barely changed at 2,608.24. Australia’s S&P/ASX 200 climbed 0.6% to 7,323.70.
Shares rose in India and Bangkok.
The Asian Development Bank issued an update on regional economies noting that exports have weakened as growth has slowed in China and other major economies. Demand for key technology exports fell sharply, the report by the regional development lender said.
In other trading Wednesday, U.S. benchmark crude rebounded from early losses, gaining 26 cents to $75.92 a barrel in electronic trading on the New York Mercantile Exchange. It climbed $1.58 to $75.66 a barrel on Tuesday.
Brent crude, the pricing basis for international trading, picked up 36 cents to $79.99 a barrel.
The U.S. dollar climbed to 139.68 Japanese yen from 138.83 yen. The euro fell to $1.1221 from $1.1230.
On Tuesday, Wall Street’s growing frenzy around artificial intelligence pushed stocks to their best level in more than 15 months. Stocks in the financial industry also drove the market higher.
The S&P 500 rose 0.7% Tuesday to its highest finish since early April 2022. The Dow added 366 points, or 1.1%, and the Nasdaq composite climbed 0.8%.
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Kurtenbach reported from Bangkok; Ott reported from Silver Spring, Md.
