Global markets stabilize; US indexes open higher on earnings
NEW YORK — Global stock markets steadied Tuesday as a rout in Chinese shares slowed and US indexes turned higher. European shares also gained. Investors were encouraged by strong results from UPS, Ford and other big companies.
KEEPING SCORE: The Dow Jones industrial average rose 80 points, or 0.5 percent, to 17,521 as of 11:26 a.m. Eastern. The Standard & Poor’s 500 index rose 11 points, or 0.5 percent, to 2,078 and the Nasdaq composite rose 11 points, or 0.2 percent, to 5,050.
HOME DELIVERY: UPS rose $4.37, or 4.5 percent, to $99.52. The company saw profits jump from a year ago, helped by stronger business overseas. UPS earned $1.23 billion, or $1.35 per share, for the three months ended June 30. A year earlier it earned $454 million, or 49 cents per share. UPS is sometimes seen a proxy for the global economy because of its huge role in delivering goods all over the world on a daily basis.
DRIVING PROFITS: Ford shares rose 26 cents, or 2 percent, to $14.81. The carmaker said profits jumped 44 percent in the second quarter, helped by higher sales globally and higher prices for premium trucks and SUVs. The profit of 47 cents a share easily beat Wall Street’s expectations of 37 cents a share.
DUPONT STRUGGLES: Chemical giant DuPont fell 64 cents, or 1 percent, to $56.10. The company lowered its full-year outlook, citing weaker sales in its farm products business. DuPont also cut its dividend, a rare move for any company.
CHINA FALL: The Shanghai Composite Index closed down 1.7 percent after trading down as much as 4 percent earlier in the day. The index had plunged 8.5 percent on Monday, its biggest drop since February 2007, despite concerted efforts by the Chinese government to stem the market’s slide.
US ECONOMY: Traders were turning their attention to the U.S. Federal Reserve as they try to assess when interest rates will be raised. Fed policymakers meet this week, but few central bank watchers expect a rate hike. Many expect the Fed to begin its next cycle of rate increases in September or December. Ultra-low interest rates have been a boon for stock markets, and many questions remain about how markets will react to the first increase since the 2008 financial crisis.
ENERGY: Oil prices turned higher, a day after Brent crude entered a bear market. Brent gained 44 cents to $53.95 a barrel in London. That’s still well below its high of $67.77 set on May 6. The U.S. benchmark rose 99 cents to $48.34 a barrel in New York. U.S. oil entered a bear market last Thursday, falling 21 percent below its recent peak of $61.01 on June 23.
BONDS, CURRENCIES: U.S. government bond prices fell. The yield on the 10-year Treasury note rose to 2.25 percent from 2.22 percent. The dollar rose to 123.60 Japanese yen from 123.27 yen on Monday. The euro fell to $1.1052 from $1.1087.
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