US stocks climbing as Wall Street risk appetite returns


US stocks climbing as Wall Street risk appetite returns

U.S. stocks were bouncing back on Friday, after a volatile week, as possible stimulus measures in Europe sparked a rise in Wall Street’s risk appetite.

Markets were anticipating the European Central Bank will cut rates in September and resume a bond-buying program, according to Reuters.

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The major European markets traded higher.

Add Mexico as the latest country to cut interest rates overnight.

Deere & Co., which missed quarterly profit estimates, said it was beginning a review of its costs in a bid to reduce expenses and boost its bottom line. Investors rewarded the company by bidding up its shares.

General Electric shares rose as Chief Executive Officer Larry Culp bought nearly $2 million worth of shares a day after recording their biggest one-day percentage fall in 11 years.

Nvidia shares jumped after quarterly profit and revenue topped expectations.

On the economic front on Friday, the Commerce Department said U.S. homebuilding fell for a third straight month in July amid a steep decline in the construction of multi-family housing units, but permits rose creating optimism. Housing starts dropped 4 percent to a seasonally adjusted annual rate of 1.191 million units last month.

Ticker Security Last Change %Chg
DE DEERE & COMPANY 149.28 +5.57 +3.88%
GE GENERAL ELECTRIC COMPANY 8.70 +0.69 +8.61%
NVDA NVIDIA CORPORATION 159.29 +10.52 +7.07%

Investors have suffered whiplash this week after the U.S. yield curve — the difference between yields on the U.S. 10-year and 2-year Treasury bonds — inverted for the first time since 2007. It has historically been an accurate forecaster of a coming recession.

The major U.S. stock indexes spent much of the day reacting to big moves in U.S. government bond yields, which fell sharply in the early going, fluctuated for much of the day, and then recovered some of their decline by mid-afternoon.

Stocks are down more than 2.4 percent this week and are on course for their third consecutive losing week.

The U.S.-China trade war has hammered American manufacturers and roiled global financial markets with fears that the world’s largest economy could slip into a recession. Yet most analysts expect the U.S. economy to power through the rough patch, at least in the coming months, on the strength of solid consumer spending and a resilient job market.

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Japan’s Nikkei rebounded from early losses to gain 0.1 percent, Hong Kong’s Hang Seng added 0.9 percent and China’s Shanghai Composite gained 0.3 percent.

The Associated Press contributed to this article.


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