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* Germany could suspend balanced budget rule to avoid
recession
-report
* U.S. Treasury yields ease off lows, boosting banks
* Nvidia jumps after results, lifts chip stocks
* Indexes up: Dow 1.08%, S&P 1.39%, Nasdaq 1.68%
(Updates to late afternoon, changes dateline, byline)
By Stephen Culp
NEW YORK, Aug 16 (Reuters) - Technology shares led Wall
Street's advance on Friday as a waning bond rally and news of
potential German economic stimulus brought buyers back to the
market at the close of a turbulent week.
While all three major U.S. stock averages were sharply
higher, they are still on track to post their third straight
weekly declines, having been battered since Monday by
accelerating U.S.-China trade animosity, simmering geopolitical
tensions and signals from the bond market that sparked fears of
imminent recession.
Germany's coalition government is willing to suspend its
balanced budget rule and take on debt, according to Der Spiegel
magazine, raising hopes that Europe's largest economy could
steer itself away from recession and cooling worries over a
global economic slowdown, for now. "Germany's willingness to shift away from long-held
practices magnifies the fact that the level of economic
uncertainty throughout Europe is quite high," said David Carter,
chief investment officer at Lenox Wealth Advisors in New York.
"It's a bit like the Fed lowering rates more than expected,"
Carter added. "Great headline, but further analysis may
eventually create uncertainty and weaken markets."
German stimulus hopes helped the benchmark 10-year U.S.
Treasury yield rise from three-year lows, closing the book on a
fraught week which saw 10-year yields dip below those of
two-year notes, a classic recessionary red flag. Rising bond yields gave a boost to rate-sensitive banks,
sending the S&P 500 Banks index .SPXBK up 2.7%
The Dow Jones Industrial Average .DJI rose 275.17 points,
or 1.08%, to 25,854.56, the S&P 500 .SPX gained 39.7 points,
or 1.39%, to 2,887.3 and the Nasdaq Composite .IXIC added
130.42 points, or 1.68%, to 7,897.04.
All 11 major sectors of the S&P 500 were firmly in the
black, with financials .SPSY , industrials .SPLRCI and
technology .SPLRCT enjoying the largest percentage gains
Nvidia Corp NVDA.O jumped 6.7% after the chipmaker's
quarterly results bested analyst estimates, helping the
Philadelphia chip index .SOX gain 2.8%. Deere & Co DE.N cut its earnings forecast after missing
Street profit estimates in the face of the ongoing U.S.-China
trade war. Still, the farm equipment maker's decision to cut
costs sent the stock up 3.5%. General Electric (NYSE:GE) Co GE.N surged by 8.7% after Chief
Executive Officer Larry Culp bought nearly $2 million in shares
in the wake of the conglomerate's worst one-day percentage drop
in 11 years.
The second-quarter earnings season approaches the finish
line, with 459 of the companies in the S&P 500 having posted
results. Of those, 73% beat Street estimates, according to
Refinitiv data.
Analysts now see S&P 500 second-quarter earnings growth of
2.9% year-on-year, per Refinitiv.
Advancing issues outnumbered declining ones on the NYSE by a
3.58-to-1 ratio; on Nasdaq, a 4.00-to-1 ratio favored advancers.
The S&P 500 posted 32 new 52-week highs and 7 new lows; the
Nasdaq Composite recorded 33 new highs and 87 new lows.