(Reuters) – The S&P and Dow edged higher on Friday as a batch of strong earnings overshadowed worries of an escalating trade war between the United States and China, after Beijing proposed new tariffs on $60 billion worth of U.S. goods.
Traders work on the floor of the New York Stock Exchange shortly after the opening bell in New York, U.S., July 31, 2018. REUTERS/Lucas Jackson
China’s retaliatory tariffs on U.S. goods ranged from liquefied natural gas (LNG) to certain types of aircraft and came after President Donald Trump proposed 25 percent tariffs on $200 billion worth of Chinese imports.
“Markets are viewing China’s move as another part of the tit-for-tat, so far nothing has been imposed and it is still in discussion,” said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago.
The S&P consumer staples sector .SPLRCS rose 1.47 percent and led gains among the major S&P sectors.
Kraft Heinz (KHC.O) jumped 8.1 percent and was the biggest boost to the sector after the company topped quarterly profit and revenue estimates.
Take-Two (TTWO.O) jumped 11.8 percent, the most on the benchmark S&P 500, after the videogame maker’s quarterly revenue topped estimates.
“There is a positive sentiment with earnings. The economy is still doing alright despite the trade policy uncertainty,” said Scott Brown, chief economist at Raymond James in St. Petersburg, Florida.
Economic data showed U.S. job growth slowed more than expected in July as employment in the transportation and utilities sectors fell, but a drop in the unemployment rate suggested that the labor market was tightening.
At 10:58 a.m. ET the Dow Jones Industrial Average .DJI was up 55.36 points, or 0.22 percent, at 25,381.52, the S&P 500 .SPX was up 4.71 points, or 0.17 percent, at 2,831.93 and the Nasdaq Composite .IXIC was down 6.64 points, or 0.09 percent, at 7,796.04.
Earnings till date have been robust. Of the 406 companies, part of the S&P 500, that have reported earnings, 78.6 percent have topped analysts’ expectations, according to Thomson Reuters I/B/E/S.
Only two of the 11 major S&P sectors were lower. The energy sector .SPNY fell 0.78 percent on the back of lower crude oil prices.
Symantec (SYMC.O) slipped 13.9 percent, and was the biggest decliner on the S&P, after the antivirus software maker lowered its yearly revenue forecast.
Dish (DISH.O) jumped 7.3 percent after the satellite TV services provider reported a better-than-expected quarterly profit.
Advancing issues outnumbered decliners for a 1.35-to-1 ratio on the NYSE. Declining issues outnumbered advancers for a 1.35-to-1 ratio on the Nasdaq.
The S&P index recorded 17 new 52-week highs and two new lows, while the Nasdaq recorded 60 new highs and 41 new lows.
Reporting by Amy Caren Daniel in Bengaluru; Editing by Shounak Dasgupta