Wall Street is rising Wednesday after Ford Motor, Chipotle Mexican Grill and other big stocks climbed following their latest earnings reports. The S&P 500 was up 0.6% in midday trading and on track to return to a record. The Dow Jones Industrial Average was 166 points higher, or 0.4%, and the Nasdaq composite was up 0.7%.
Wall Street ticks higher as yields hold steady, bank stocks swing
Newslooks- NEW YORK (AP) —
Wall Street is rising Wednesday after Ford Motor, Chipotle Mexican Grill and other big stocks climbed following their latest earnings reports.
The S&P 500 was up 0.6% in midday trading and on track to return to a record. The Dow Jones Industrial Average was 166 points higher, or 0.4%, and the Nasdaq composite was up 0.7%.
The relatively modest moves for the indexes belied some sharp swings for stocks underneath the surface. New York Community Bancorp, for example, went from an initial gain to a loss of 10.4% for its latest zigzag. It’s down more than 60% since rattling investors across the banking industry last week with a surprise loss.
It’s struggling with challenges related to its acquisition of Signature Bank, which was one of the banks that collapsed in last year’s mini-crisis for the industry. But New York Community Bancorp is also feeling pain from a problem dogging banks worldwide: weakness in commercial real estate.
Moody’s downgraded the bank’s credit rating late Wednesday to “junk” status from the lowest tier of investment-grade. Analysts also said they were concerned about the departures of key risk and audit executives for the bank.
New York Community Bancorp’s stock then went on a wild ride in off-hours trading, sinking and then rising after the bank said it had increased its deposits and gave details about how much cash it has on hand.
Stocks of other regional banks have been caught up in the drama, to a lesser degree, which has brought back uncomfortable memories of last year’s banking crisis. The KBW Nasdaq Regional Banking index fell 1.5%.
UBS analyst Brody Preston said New York Community Bancorp’s latest quarterly loss and dividend cut are due to problems related specifically to it and “are not necessarily a proverbial canary in the coal mine for other banks in the space.” But attention is likely to remain on potential losses for banks tied to commercial real estate, particularly after Treasury Secretary Janet Yellen recently highlighted them as a concern.
Elsewhere on Wall Street, Chipotle Mexican Grill rose 7.8% after reporting stronger profit and revenue for the latest quarter than analysts expected. Its restaurants sold more meals to customers than they did a year earlier.
CVS Health gained 3.2% after it likewise topped expectations for both profit and revenue in the final three months of 2023. The drugstore chain and pharmacy benefits manager, though, also trimmed its forecast for full-year results.
Ford Motor climbed 2.2% following its better-than-expected results, while Enphase Energy soared 18.1% despite falling just shy of forecasts. Investors are hopeful that weakness in demand for the supplier of solar and battery systems is nearing a bottom.
They helped offset a 12.6% drop for VF Corp., the company behind Vans, The North Face and other brands. It reported weaker results than analysts expected.
Snap tumbled 34.2% after its fourth-quarter revenue fell short of analysts’ expectations. The company behind Snapchat also gave a tepid forecast for 2024 after saying on Monday that it was laying off 10% of its workforce.
Wall Street was also trying to game out potential impacts from an announcement that ESPN, Fox and Warner Bros. Discovery are planning to launch a streaming platform for sports. Many details are still to be worked out, as is how it will impact prices for broadcasting rights with sports leagues. But fuboTV, a streaming service that offers sports, fell 29.5%.
In the bond market, Treasury yields were mixed. The yield on the 10-year Treasury was holding steady at 4.09%, where it was late Tuesday. It’s been on a jagged run recently as signals of a remarkably resilient economy force traders to push back forecasts for when the Federal Reserve may cut interest rates.
While a delay in rate cuts hurts the stock market, strong economic data also carry an upside for investors. They should mean stronger profits for companies.
In stock markets abroad, indexes were modest lower in Europe and mixed in Asia.
Stocks rose 1.4% in Shanghai but slipped 0.3% in Hong Kong following moves this week by authorities to prop up what have been some of the world’s worst-performing markets this year.
