© Reuters. The spread of the coronavirus disease (COVID-19) in New York
By Chuck Mikolajczak
NEW YORK (Reuters) – U.S. stocks climbed on Wednesday in the wake of a surprise quarterly profit from Disney and as investors hailed signs that a deal was near for a U.S. coronavirus fiscal aid package.
Walt Disney Co’s (N:) shares jumped 9.06%, among the biggest boosts to the S&P 500 and Dow, and was on track for its biggest daily percentage gain since March 24 as revenue declines for its parks and media networks were not as bad as feared.
“What is helping not just Disney but the markets in general is everyone is completely buying into the Disney move to streaming but then if you do look at the theme parks, the data for the U.S. at large has gotten much more positive lately where we are at least getting initial indications we are sort of over that hump,” said Shawn Cruz, senior manager of trader strategy at TD Ameritrade (NASDAQ:) in Jersey City, New Jersey.
The Dow Jones Industrial Average () rose 321.61 points, or 1.2%, to 27,150.08, the S&P 500 () gained 21.96 points, or 0.66%, to 3,328.47 and the Nasdaq Composite () added 59.92 points, or 0.55%, to 11,001.09.
Payments processor Square Inc (N:) surged 8.50% after reporting a 64% rise in second-quarter revenue, as consumers increased online buying and used its peer-to-peer Cash App platform during the pandemic.
As quarterly results have come in better-than-feared and heavyweight technology and technology-related companies have surged, a heavy dose of fiscal and monetary stimulus have helped fuel a rally in equities to bring the S&P 500 less than 2% from its closing record on Feb. 19.
With 384 companies in the S&P having reported earnings through Wednesday morning, results are coming in 23.5% above expectations, in aggregate, according to Refinitiv data, the highest on record back to 1994.
Economic data painted a mixed picture, as U.S. services industry activity gained momentum in July, according to an ISM survey, with new orders jumping to a record high. However, hiring declined, supporting views that a recovery in the labor market was faltering.
Earlier, the ADP National Employment Report, which can be an inconsistent precursor to the government payrolls report set for Friday, showed U.S. private employers hired far fewer workers than expected last month.
U.S. Congressional Democrats and White House officials were set to resume negotiations on coronavirus relief legislation on Wednesday, with administration officials aiming for an agreement by Friday.
Financials (), industrials () and materials (), that track economic growth, outperformed among the major S&P sectors.
Teladoc Health Inc (N:) fell 17.30% after agreeing to buy chronic care provider Livongo Health Inc (O:) in a deal valuing the company at $18.5 billion, betting on a boom in online care and consultations spurred by the coronavirus crisis. Livongo shares fell 10.23%.
Electric truckmaker Nikola Corp (O:) slumped 8.16% after it reported a bigger quarterly loss in its first results as a listed entity.
Advancing issues outnumbered declining ones on the NYSE by a 2.27-to-1 ratio; on Nasdaq, a 1.93-to-1 ratio favored advancers.
The S&P 500 posted 48 new 52-week highs and no new lows; the Nasdaq Composite recorded 202 new highs and 9 new lows.