Stock Market News For July 21, 2016

Sharp growth in Microsoft’s cloud computing business helped both the Dow and the S&P 500 to close at fresh record highs on Wednesday. The Dow ended at a record high for the seventh day. The blue-chip index also registered its ninth straight session of gains, its longest such streak winning streak since Mar 2013. Among the S&P 500 sectors, technology gained the most, with Microsoft (NASDAQ:MSFT) contributing significantly to the upside. Technology had its best day in 16 years. The tech-heavy Nasdaq too closed at its highest level for this year mostly led by gains in biotech.

For a look at the issues currently facing the markets, make sure to read today’s Ahead of Wall Street article.

The Dow Jones Industrial Average (DJI) gained 0.2% to close at 18,595.03. The S&P 500 advanced 0.4% to close at 2,173.02. The tech-laden Nasdaq Composite Index closed at 5,089.93, increasing 1.1%. The fear-gauge CBOE Volatility Index (VIX) dropped 1.7% to settle at 11.77, its lowest level since Aug 2014. VIX fell for the sixth successive session, its longest losing streak since April. A total of around 6.2 billion shares were traded on Wednesday, below the last 20-session average of 7.5 billion shares. Advancers outpaced declining stocks on the NYSE. For 65% stocks that advanced, 32% declined.

The Dow and the S&P 500 set new records on Wednesday, as Microsoft Corporation’s (MSFT) encouraging quarterly earnings results boosted the indexes. Microsoft’s fourth quarter 2016 earnings per share of 69 cents beat the Zacks Consensus Estimate of 58 cents. Revenues of $20.61 billion, however, missed the Zacks Consensus Estimate by 6.8%.

Nevertheless, Microsoft’s promising earnings results showed that the company is efficiently managing its on-demand computer services. Sales of Redmond, Wash and its Azure cloud computing services more than doubled, which offset losses in its flagship Windows operating systems. Shares of Microsoft jumped 5.3%.

The Technology Select Sector SPDR ETF (NYSE:XLK) increased 1.6%, the highest among the S&P 500 sectors. Key stocks from the sector including Intel Corporation (NASDAQ:INTC) (INTC), Cisco Systems (NASDAQ:CSCO), Inc. (CSCO), Facebook (NASDAQ:FB), Inc. (FB) and Alphabet (NASDAQ:GOOGL) Inc. (GOOGL) rose 1.5%, 2.4%, 1.1% and 0.5%, respectively.

Among other earnings reports, Morgan Stanley’s (MS) second-quarter 2016 earnings of 75 cents per share outpaced the Zacks Consensus Estimate of 60 cents. Revenues of $8.91 billion also surpassed the Zacks Consensus Estimate of $8.34 billion. Shares of Morgan Stanley (NYSE:MS) gained 2.1%.

Halliburton Company (HAL) reported second quarter loss per share of 14 cents, narrower than the Zacks Consensus Estimate of a loss of 19 cents. Revenues of $3,835 million surpassed the Zacks Consensus Estimate of $3,744 million. However, shares of Halliburton (NYSE:HAL) fell 1.6% as lower pricing and reduced global activities, eventually weighed on the company’s performance.

Shares of Abbott Laboratories (NYSE:ABT) (ABT) advanced 2% after the company posted second quarter earnings of 55 cents per share, higher than the Zacks Consensus Estimate of 53 cents. Revenues of $5.3 billion also came in ahead of the Zacks Consensus Estimate of $5.26 billion.

Gains in biotech stocks helped the Nasdaq end higher yesterday. Key biotech stocks including Amgen (NASDAQ:AMGN), Inc. (AMGN), Celgene Corporation (NASDAQ:CELG) (CELG), Biogen (NASDAQ:BIIB) Inc. (BIIB) and Mylan (NASDAQ:MYL) N.V. (MYL) increased 0.5%, 2.3%, 1% and 5.1%, respectively. The iShares Nasdaq Biotechnology ETF (IBB) went up 2.4%, while the broader Health Care Select Sector SPDR ETF (NYSE:XLV) gained 0.9%.

Wednesday’s gains came on the heels of a string of economic data including improvements in homebuilding, retail sales and job creations. Such upbeat reports along with expectations that central bank’s around the world will introduce stimulus measures to reinvigorate their economies also helped boost the stock market.

MICROSOFT CORP (MSFT): Free Stock Analysis Report

INTEL CORP (INTC): Free Stock Analysis Report

CISCO SYSTEMS (CSCO): Free Stock Analysis Report

FACEBOOK INC-A (FB): Free Stock Analysis Report

ALPHABET INC-A (GOOGL): Free Stock Analysis Report

MORGAN STANLEY (MS): Free Stock Analysis Report

HALLIBURTON CO (HAL): Free Stock Analysis Report

ABBOTT LABS (ABT): Free Stock Analysis Report

AMGEN INC (AMGN): Free Stock Analysis Report

CELGENE CORP (CELG): Free Stock Analysis Report

BIOGEN INC (BIIB): Free Stock Analysis Report

MYLAN NV (MYL): Free Stock Analysis Report

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