Stocks end off earlier highs as China tariff roll back claims questioned
Stocks were higher for most of the session after a Chinese Ministry of Commerce spokesperson said that China and the U.S. have agreed to lift tariffs in phases as the two sides work towards a trade deal. However, reports later in the day appeared to contradict the China claim and said the U.S. had not yet agreed to tariff roll backs. Trade headlines continue to largely dictate the market's direction, but earnings reporting continues as well, with the latest highlight to be Disney's (DIS) report after the closing bell.
ECONOMIC EVENTS: In the U.S., initial jobless claims fell by a more than expected 8,000 to 211,000 in the week ended November 2. Consumer credit grew by $9.5B in September, missing the consensus forecast for growth of $15.0B for the month.
In trade news, Reuters reported that China said it had agreement with the U.S. on a plan to cancel tariffs in phases. However, reports later in the day said a plan to roll back China tariffs faces "fierce internal opposition" in the Trump Administration and no final decision has been made.
TOP NEWS: Shares of Qualcomm (QCOM) jumped 6.3% after the chipmaker's fourth quarter earnings per share beat consensus estimates and it gave better than expected Q1 guidance. In previewing the coming year, the company said its "technology and inventions leave us extremely well positioned as 5G accelerates in 2020."
Shares of Expedia (EXPE) dropped 27.4% after the online travel agency reported an EBITDA and bookings miss in Q3 and cut its FY19 guidance as organic free links continue to shift down in favor of paid links. Following the company's report, at least four Wall Street research firms lowered their ratings on the stock. Meanwhile, TripAdvisor (TRIP) shares fell 22.4% as the rival OTA also reported worse than expected quarterly results.
Last night, HP Inc. (HPQ) confirmed that it has held conversations with Xerox (XRX) "from time to time" about a potential business combination and received a proposal transmitted in the prior day from its rival. HP confirmed the bid, but declined to disclose the offer price, though CNBC's David Faber reports, citing his sources, that Xerox offered to acquire HP for $22 per share in cash and stock.
Meanwhile, Reuters reported that T-Mobile (TMUS) CEO John Legere acknowledged that talks are ongoing with Sprint (S) to extend their merger agreement, though he declined to rule out requesting the $26B price be lowered.
Additionally, Juul Labs CEO K.C. Crosthwaite announced that the company will stop selling mint-flavored vaping products in the U.S. The Fly notes that Altria (MO) has a 35% stake in Juul.
MAJOR MOVERS: Among the noteworthy gainers was Collegium Pharmaceutical (COLL), which gained 31.4% after reporting quarterly results and after it said on its quarterly call that as of January 1, 2020, Xtampza ER will move into an exclusive formulary position across 15 plans covering more than 35M lives. Also higher after reporting quarterly results were DexCom (DXCM) and GoDaddy (GDDY), which gained a respective 27.2% and 16%.
Among the notable losers was Roku (ROKU), which dropped 16% after it reported quarterly results and provided revenue guidance for fiscal 2019. Also lower after reporting quarterly results were Party City (PRTY) and Fossil Group (FOSL), which fell 67.2% and 21.1%, respectively.
INDEXES: The Dow rose 182.24, or 0.66%, to 27,674.80, the Nasdaq gained 23.89, or 0.28%, to 8,434.52, and the S&P 500 advanced 8.40, or 0.27%, to 3,085.18.