Stocks climbed during Thursday's session after President Trump delayed the next round of U.S. tariffs by about two weeks, extending an olive branch to China after the country made a request for the delay in advance of the next round of trade talks. There were also conflicting reports about whether the U.S. would be offering a "mini-deal" to China in order to further delay, or even rollback, some tariffs. Adding further fuel was the European Central Bank's fresh round of stimulus, including a cut of a key rate further into negative territory.
ECONOMIC EVENTS: In the U.S., initial jobless claims dropped 15,000 to 204,000 in the week ended August 7. The Consumer Prices Index rose 0.1% in August, with the core rate increasing 0.3%, which was a little above expectations. In trade news, Reuters reported that Chinese importers have purchase no fewer than 10 boatloads of U.S. soybeans on Thursday, their most significant purchases since at least June. The move comes ahead of high-level talks next month aimed at ending a bilateral trade dispute between China and the U.S.
In Europe, the ECB announced the interest rate on its deposit facility will be decreased by 10 basis points to -0.50%. The interest rate on the main refinancing operations and the rate on the marginal lending facility will remain unchanged at their current levels of 0.00% and 0.25% respectively. Additionally, the ECB announced that net purchases will be restarted under the Governing Council's asset purchase program, or APP, at a monthly pace of EUR20B, beginning November 1.
TOP NEWS: Shares of Oracle (ORCL) fell 4.3% after the company reported earnings a day early as the news was likely brought forward by the accompanying announcement that co-CEO Mark Hurd will take a leave of absence for health related reasons. First quarter revenue came in below the consensus forecast and guidance also missed expectations, though Oracle said it is "off to a good start in FY20" and expects a third consecutive year of double-digit non-GAAP EPS growth.
AT&T (T) shares were almost 1% lower after the company provided an updated outlook on Q3 and FY20 in conjunction with CFO John Stephens' presentation at the Bank of America Merrill Lynch Media, Communications & Entertainment conference yesterday. Of note, Stephens said the company expects an incremental 300,000 to 350,000 premium video losses in the third quarter compared to the previous quarter's results, driven by aggressively managing costs with retransmission negotiations, some of which resulted in content provider black outs, and from limiting promotional pricing.
Alphabet's Google (GOOGL) unit reached a settlement with France's Parquet National Financier to pay 500M euros regarding taxes at its Irish unit. In addition to the 500M euro settlement, Google will pay another 465M euros to end France's criminal probe into tax fraud allegations, Le Figaro reported.
Meanwhile, shares of Enphase Energy (ENPH) and Solaredge (SEDG) slipped after Citron Research targeted the solar inverter manufacturers in a new short report. Andrew Left's Citron said both stocks trade at "significantly inflated multiples on peak earnings even as a very credible competitive threat is about to enter the solar inverter market," namely Generac (GNRC). Enphase shares fell 10.2% after the short report, while Solaredge dropped 9.8%.
MAJOR MOVERS: Among the noteworthy gainers was Moderna (MRNA), which rose 3% after announcing data from two Phase 1 studies of its investigational cytomegalovirus vaccine mRNA-1647 and of mRNA-1944 administered via intravenous infusion in healthy adults. Also higher was LKQ Corp. (LKQ), which jumped 11.9% after Jeffrey Ubben's ValueAct Capital disclosed a new activist stake in the company.
Among the notable losers was Tocagen (TOCA), which plunged 77.7% to trade below $1 per share after announcing that the Toca 5 Phase 3 clinical trial evaluating Toca 511 & Toca FC in patients with recurrent high grade glioma undergoing resection missed the primary endpoint of overall survival compared to standard of care treatment. Also lower was Tailored Brands (TLRD), which fell 29.6% after reporting quarterly results. Additionally, Groupon (GRPN) fell 4% after the Wall Street Journal's Nina Trentman reported that the company is pursuing a relatively large acquisition and Yelp (YELP) is speculated as the target. Yelp shares gained 5.5% after the report.
INDEXES: The Dow rose 45.41, or 0.17%, to 27,182.45, the Nasdaq gained 24.79, or 0.3%, to 8,194.47, and the S&P 500 advanced 8.64, or 0.29%, to 3,009.57.