Published: Sat, January 27, 2018
Finance | By Kristine Clayton

Intel lifts S&P, Dow to new highs; Starbucks weighs on Nasdaq

Intel lifts S&P, Dow to new highs; Starbucks weighs on Nasdaq

S&P 500 e-minis were up 9.75 points, or 0.34 percent, with 163,684 contracts traded. The Nasdaq Composite Index was down 3.89 points, or 0.05 percent, to 7,411.16. With the drop, the index ended the session at its lowest closing level in nearly a month. Shares of 3M rose 0.6 per cent in the morning session.

The Dow is up 321.07 points, or 1.2 percent.

AbbVie surged 13.8 per cent, while Dow member Pfizer gained 4.8 per cent and Gilead Sciences advanced 5.3 per cent.

USA stocks rose to fresh records on Friday, propelled by strong earnings from Intel and drugmaker AbbVie as well as a weaker dollar, putting the three main indexes on track for their best four-week rally since 2016. The S&P and the two other main indexes all notched their best four-week runs since 2016.

Pharmaceutical shares were also skyward-bound as AbbVie released 2018 profit and revenue forecasts that topped analyst expectations, citing United States tax reform and improved operational performance.

"We continue to see these positive steps in the right direction and definitely earnings are clearly justifying a lot of the recent move that we've had", said Ryan Detrick, senior market strategist at LPL Financial in Charlotte, NC.

As of Thursday, 77 percent of the S&P 500 companies that had reported surpassed earnings expectations, while 79 percent of those companies had beaten sales estimates, according to US financial information company FactSet.

The earnings enabled investors to shrug off a reading on economic growth that came in below expectations. Gross domestic product for the fourth quarter rose 2.6% as consumption and business activity picked up. All companies reported better earnings. A weaker dollar tends to benefit large US multinational companies.

The dollar was on track for its worst week since May after comments from senior USA officials this week backing a weak currency.

The Dow Jones Industrial Average rose 223.92 points, or 0.85 percent, to 26,616.71, the S&P 500 gained 33.62 points, or 1.18 percent, to 2,872.87, and the Nasdaq Composite added 94.61 points, or 1.28 percent, to 7,505.77.

Starbucks (O:) fell about 5 percent after it warned 2018 global cafe sales growth would be at the low end of its forecast.

Wall Street also digested key USA economic data on Friday.

The euro strengthened to the highest level in three years as European Central Bank President Mario Draghi pointed to the region's "robust pace of economic expansion, which accelerated more than expected in the second half of 2017".

Safe-play stocks like utilities and phone companies also rose, but homebuilders slumped after a sharp drop in new home sales last month.

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