Fly Intel: Wall Street's top stories for Tuesday
Stocks opened in negative territory with the early weakness attributed to a mixed earnings report from Netflix (NFLX) and fallout from President Trump's comments about Russian meddling during the 2016 election. The averages saw their lows shortly after the open and began to drift higher as Fed Chair Powell testified before Congress about current monetary policy. His tone was positive, which gave confidence to the bulls, who pushed the market into positive territory. The Nasdaq, which spent the early part of the day as the weakest of the averages, finished the day at an all-time high as Amazon (AMZN) advanced and Netflix significantly cut its post-earnings losses. ECONOMIC EVENTS: In the U.S., industrial production bounced 0.6% in June, after falling 0.5% in May. Manufacturing production was up 0.8%, versus down 1.0% in the prior month. The NAHB housing market index was unchanged at 68 in July. Additionally, Fed Chairman Powell gave his testimony before the Senate Banking Committee in his first of two days presenting on Capitol Hill. In his prepared text, the Powell stated that "with a strong job market, inflation close to our objective, and the risks to the outlook roughly balanced, the FOMC believes that--for now--the best way forward is to keep gradually raising the federal funds rate." COMPANY NEWS: After the company missed its subscriber addition projections for the first time in five quarters, Deutsche Bank analyst Bryan Kraft downgraded Netflix to Hold as he believes that the "slowdown in growth" requires a "reevaluation of value." Meanwhile, both BMO Capital and Stifel upgraded the stock to Buy-equivalent ratings as they called the post-earnings weakness in the shares as a buying opportunity. The stock finished the day with a decline of about 5%, well off its worst levels of the session... Healthcare-focused Dow members Johnson & Johnson (JNJ) and UnitedHealth (UNH) moved in opposite directions. J&J advanced 3.5% after its report of better than expected second quarter sales and profits, while UnitedHealth slipped about 2.5% despite reporting better than expected Q2 EPS and boosting its adjusted earnings view for the fiscal year... Goldman Sachs (GS) concluded what it called its "strongest first-half returns in nine years" with its report of better than expected Q2 earnings. The firm also announced that David Solomon will become CEO on October 1, ending the tenure of Lloyd Blankfein, who has run the bank since 2006... Walmart (WMT) announced a strategic partnership with Microsoft (MSFT) to further accelerate its digital transformation in retail as it tries to fend off Amazon. In addition, the Information reported that Walmart is mulling launching a subscription streaming video service to compete with Netflix and Amazon Prime Video, even though such a move could be "enormously costly" for the retailer. MAJOR MOVERS: Among the noteworthy gainers was Tribune Media (TRCO), which rose roughly 3.75% after Stephens analyst Kyle Evans upgraded the stock to Overweight from Equal Weight following yesterday's FCC-induced pullback, saying that "fear creates opportunity" and that a combination of the company and Sinclair Broadcast (SBGI) "remains the best possible outcome for both parties." Also higher was Charles Schwab (SCHW), which gained 3.5% after reporting quarterly results. Among the notable losers was Aveo (AVEO), which dropped 24% after it delayed its Tivo-3 data to the fourth quarter. Also lower was Omnicom (OMC), which fell 9.5% after reporting quarterly results. INDEXES: The Dow rose 55.53, or 0.22%, to 25,119.89, the Nasdaq gained 49.40, or 0.63%, to 7,855.12, and the S&P 500 advanced 11.12, or 0.4%, to 2,809.55.