U.S. stocks rose Wednesday morning, putting them on track for a third straight day of gains as investors weighed conflicting data on the U.S. economy with concerns tied to the U.K.’s exit from the European Union.
Shares of Boeing were on investors’ minds in the aftermath of a series of groundings of its 737 Max 8 fleet by regulators outside the U.S., with the stock edging higher for the first time eight sessions.
How did major indexes fare?
The Dow Jones Industrial Average DJIA, +0.72% rose 136 points, or 0.5%, to 25,687, while the S&P 500 index SPX, +0.91% added 20 points, or about 0.7%, to 2,811. The Nasdaq Composite Index COMP, +0.94% advanced 57 points, or 0.8%, at 7,648.
Read: Why a bout of small-cap carnage could be a red flag for stock-market bulls
What drove the market?
U.S. investors continue to parse conflicting data on the U.S. economy, with a report on durable goods orders coming in surprisingly strong Wednesday, following previous reports showing a sharp slowdown in business investment.
A wholesale inflation report published Tuesday, however, came in weaker than expected, following a disappointing jobs report last week.
British lawmakers on Tuesday rejected Prime Minister Theresa May’s revised Brexit deal in a 242-391 vote and now are looking at a second vote to on whether an exit without a pact with Europe’s trade bloc can be taken off the table before a March 29 deadline.
A so-called hard-Brexit scenario has stoked volatility in Britain’s currency and has the potential to unsettle domestic markets, experts say.
Meanwhile, concerns around growth in the U.S. continued after new inflation data published on Tuesday came in weaker than expected, adding to a disappointing jobs report on Friday.
Despite those worries, and no fresh news on Sino-America trade developments, stocks have mostly climbed on the back of strong gains in the technology sector.
What data are traders watching?
Durable-goods orders rose in January by 0.4%, the government reported Wednesday, above the 0.1% decrease expected by economists polled by MarketWatch.
The Commerce Department report also showed core capital orders, a key measure of business investment, rising 0.8% in January after falling sharply the two months previous.
The cost of wholesale goods rose 0.1% in February, below the 0.2% increase expected by economists, per a MarketWatch poll. The 12-month increase in producer prices fell from 2.5% to 2.3%, well below last summer’s peak of 3% growth.
U.S. construction spending rose 1.3% in January, the Commerce Department said Wednesday, the largest increase since April, after a 0.8% decrease in December.
What are strategists saying?
“The rebound in underlying capital goods orders in January is still consistent with a slowdown in business equipment investment growth in the first quarter, although it suggests that slowdown will not be as sharp as signaled by some of the incoming survey evidence,” wrote Michael Pearce senior U.S. economist with Capital Economics in a Wednesday note.
“With the February producer price figures showing few signs of a pickup in inflation in the pipeline, there is still a strong case for the Fed to remain patient,” he added.
David Madden market analyst at CMC Markets UK, said the investment climate is “gloomy this morning as Brexit still hangs over the markets. Theresa May’s withdrawal agreement was voted down yesterday, which wasn’t a huge surprise.”
Which stocks are in focus?
Boeing Co. shares BA, +0.11% rose 0.7% early Wednesday, as the stock looks to snap a eight-day losing streak that shaved nearly 15% from its value. A pair of crashes involving its 737 Max 8 jets, have weighed on the aviation and defense maker’s stock and the Dow, where it is a key component. Shares were up 0.2% on Wednesday but remain off nearly 11% so far this week.
Shares of Rite Aid Corp. RAD, +5.38% were in focus after the drugstore chain’s CEO John Standley said he would step down. Shares were up 3.7%.
Shares of Express Inc. EXPR, -9.72% fell 6.6% Wednesday morning, after the fashion apparel retailer beat fourth-quarter profit expectations but missed on net sales and provided first-quarter outlook that was worse than forecasts.
Take-Two Interactive Software TTWO, +5.13% stock rose 3.6% Wednesday, on rumors that Sony Corp. SNE, +1.00% “is in advanced board level discussions to acquire Take Two Interactive in a mostly cash deal,” that would value the company at $130 share, according to Joel Kulina, head of technology and media trading at Wedbush Securities.
How are other markets trading?
Asian markets closed lower on Wednesday, with Japan’s Nikkei 225 NIK, -0.99% losing 1%, Hong Kong’s Hang Seng Index HSI, -0.39% shedding 0.4% and China’s Shanghai Composite Index SHCOMP, -1.09% retreating 1.1%.
European stocks were edging higher Wednesday, with the Stoxx Europe 600 SXXP, +0.63% rising 0.4%.
The price of oil CLJ9, +1.85% continued to rise Wednesday, while gold GCJ9, +0.81% also rose. The U.S. dollar DXY, -0.28% meanwhile, edged lower.
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