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Financial Markets 02/10 09:29
NEW YORK (AP) -- Stocks are drifting on Wall Street Tuesday following a
mixed set of profit reports from big U.S. companies, as Hasbro jumps but
Coca-Cola slips.
The S&P 500 added 0.1% in early trading and pulled a bit closer to its
all-time high set a couple weeks ago. The Dow Jones Industrial Average was
adding 189 points, or 0.4%, to its own record, as of 9:35 a.m. Eastern time,
and the Nasdaq composite was virtually unchanged.
The action was a bit stronger in the bond market, where Treasury yields fell
after a report showed U.S. retailers made less money at the end of last year
than economists expected. Shoppers spent roughly the same amount in December as
they did in November, less than the modest growth that economists expected.
That could be a signal that spending by U.S. households, which is the main
engine of the economy, may be losing momentum. It also comes ahead of two even
more anticipated reports coming later in the week. On Wednesday, the U.S.
government will give the latest monthly update on the unemployment rate, while
a Friday report will show how bad inflation is for U.S. consumers.
Altogether, the data should help the Federal Reserve decide what to do with
interest rates. The Fed has put its cuts to interest rates on hold, and too-hot
inflation could keep it on hold for a long time. But a weakening of the job
market, on the other hand, could push it to resume cuts more quickly.
One of the reasons the U.S. stock market remains close to records is the
expectation that the Fed will continue cutting interest rates later this year.
Lower rates can give the economy a boost, though they can also worsen inflation.
The yield on the 10-year Treasury fell to 4.15% from 4.22% late Monday.
On Wall Street, mixed reactions to the latest profit reports from big U.S.
companies helped hold the market in check.
Coca-Cola fell 1.3% after its growth in revenue for the latest quarter fell
short of analysts' expectations. It also gave a forecasted range for growth
this upcoming year for an important underlying measure of growth whose midpoint
was less than analysts' expectations.
S&P Global dropped 8.5% after giving a forecast for profit in the upcoming
year that fell short of analysts' expectations. The company famous for its
stock indexes has been struggling recently with worries that competitors
powered by artificial-intelligence technology may steal customers for its data
services. Its stock came into the day with a loss of 15% for the year so far.
But Hasbro jumped 6.6% after topping analysts' expectations for profit and
revenue in the latest quarter. The toymaker credited strength for its Magic:
The Gathering game in particular, and it announced a program to send up to $1
billion of cash to investors by buying back its own stock.
DuPont added 1% after the chemical giant reported better results for the
latest quarter than analysts expected. It also gave a forecast for profit in
2026 that topped analysts' expectations.
Outside of earnings reports, Warner Bros. Discovery climbed 1.3% after
Paramount said it upped its offer to buy the entertainment company.
Paramount said it will increase its offer of $30 per share by 25 cents per
share for each quarter that its buyout has not closed past the end of this
year. It's to show how confident Paramount is that its deal would get an OK
from regulators at the government. Paramount also said it would pay $2.8
billion to help Warner Bros. Discovery get out of its buyout deal with Netflix.
Paramount Skydance's stock added 0.9%, while Netflix rose 2.2%.
In stock markets abroad, Japan's Nikkei 225 rallied for a second day on
expectations that a newly elected parliament will help the country's prime
minister push through tax cuts and other moves to boost the economy and
markets. The Nikkei 225 rose 2.3% to another record.
Gains for other Asian markets were more modest, while indexes were mixed in
Europe.
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AP Business Writers Yuri Kageyama and Matt Ott contributed.
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