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Stocks rose on Wednesday as Wall Street cheered strong quarterly results from Morgan Stanley and CSX.
The Dow Jones Industrials surged 79.4 points to close Wednesday at 25,199.29, with UnitedHealth and American Express outperforming.
The S&P 500 gained 6.07 points to 2,815.62, as financials rose 1.5%
The NASDAQ came out of a negative tunnel to within 0.67 points of breakeven to 7,854.44
Morgan Stanley shares rose 1.8% after the company reported better-than-expected earnings and revenue for the previous quarter, boosted by strong trading and investment banking revenue. Bank of America, Citigroup, and J.P. Morgan Chase all closed higher as well.
CSX also posted stronger-than-forecast profits and sales, sending its shares higher by 7.1%. Its gains propelled the industrials sector to a 1.1% rise and sent the Dow Transports up by 2.3%. United Continental also surged 8.8% on stronger-than-expected earnings.
The gains in banks and industrials offset a mixed performance by some of the popular large-cap tech names. Netflix fell 1.2%, slipping for the second day in a row after posting weaker-than-expected subscriber growth for the previous quarter. Amazon shares fell 0.6%, after Prime Day concluded.
Wall Street has high hopes for this earnings season, with analysts expecting S&P 500 earnings to have grown by 20% in the second quarter. With just over 9% of S&P 500 companies having released their latest quarterly results, earnings have grown 22.1%.
American Express, eBay and IBM are among the companies scheduled to report earnings after the close.
U.S. housing starts fell 12% in June to a nine-month low, the Commerce Department said. The percentage drop was also the biggest since November 2016.
According to Bespoke Investment Group, it was the biggest miss relative to expectations since January 2007. The Mortgage Bankers Association said mortgage applications also fell 2.5% last week.
Home building stocks fell on the back of the data, as KB Home and Lennar both fell more than 1%.
Prices for the benchmark for the 10-year U.S. Treasury were lower, raising yields to 2.88% from Tuesday’s 2.86%. Treasury prices and yields move in opposite directions.
Oil prices added 81 cents to $68.89 U.S. a barrel.
Gold prices recovered 30 cents at $1,227.60 U.S. an ounce.
