BofA update shows where active managers are putting money
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* JPMorgan, Wells Fargo rise despite slump in profits
* J&J beats profit estimates, boosts quarterly dividend
* Apple rises as iPhone shipments to China rebound in March
* Indexes surge: Dow 2.59%, S&P 2.80%, Nasdaq 3.35%
(Updates to open)
By Medha Singh
April 14 (Reuters) - Wall Street rose more than 2% on
Tuesday on signs some economies would ease strict
coronavirus-induced lockdowns, with investors also looking at
quarterly earnings from JPMorgan and Johnson & Johnson for clues
on the business hit from the outbreak.
Early gains were broad based with a 4.3% jump for Apple Inc
AAPL.O powering a 3% rise in the tech-heavy Nasdaq .IXIC as
data showed iPhone shipments to China rebounded slightly in
March after crashing in February. U.S. stock markets have recovered in the past month after
slumping more than 30% from their February record highs,
supported by a raft of monetary and fiscal stimulus and early
signs of a plateauing in the number of coronavirus cases.
However, S&P 500 firms are still off about $4.7 trillion in
market value and analysts have warned of a torrid earnings
season as sweeping lockdown measures ground business activity to
a shuddering halt.
Profits at JPMorgan Chase & Co JPM.N and Wells Fargo & Co
WFC.N plunged in the first quarter, as both banks set aside
billions of dollars to cover potential loan-losses from the
pandemic. However, their shares rose between 1.0% and 1.8%, after
slumping 29% and 40% respectively so far this year as the health
crisis halted deal-making.
Coronavirus-fueled uncertainty also forced Johnson & Johnson
JNJ.N to cut its 2020 adjusted profit forecast, but its shares
rose 4.1% as it boosted its quarterly dividend, signaling
financial stability at a time when a slate of blue-chip firms
have suspended dividends to shore up cash reserves. "It should come as no surprise that earnings are going to be
hit very hard in 2020," said Fiona O'Neill, deputy head of
equities research at Fidelity International in London.
"But it would be wrong to focus too much on 2020. Instead,
we must look to forecast where earnings will go in 2021 and
beyond so that we can continue to identify those companies that
are going to emerge from this as winners."
At 10:24 a.m. ET, the Dow Jones Industrial Average .DJI
was up 605.91 points, or 2.59%, at 23,996.68, while the S&P 500
.SPX was up 77.31 points, or 2.80%, at 2,838.94. The Nasdaq
Composite was up 274.63 points, or 3.35%, at 8,467.05.
President Donald Trump said late on Monday his
administration was close to completing a plan to re-open the
economy, but some state governors said the decision to re-start
businesses lies with them. "The 'turned the corner' narrative has a strong immediacy,
but there remain creeping concerns about a slow economic
re-opening and lasting changes to consumer spending," said
Yung-Yu Ma, chief investment strategist at BMO Wealth Management
in Portland, Oregon.
Tesla Inc TSLA.O surged 12.9% and was among the top boosts
to the Nasdaq after brokerage Credit Suisse upgraded the
electric carmaker's stock to "neutral".
The S&P 1500 airlines index .SPCOMAIR gained 7.1% as
sources said some large U.S. passenger airlines were close to
accepting the terms of a $25 billion offer for government
payroll aid. Advancing issues outnumbered decliners more than 9-to-1 on
the NYSE and 6-to-1 on the Nasdaq.
The S&P index recorded seven new 52-week highs and no new
low, while the Nasdaq recorded 20 new highs and two new lows.