(Reuters) – U.S. stocks rose and the Nasdaq hit a record high on Monday, as a recent set of strong domestic economic data and largely upbeat fourth-quarter earnings tempered worries about the impact of the coronavirus outbreak on global growth.
People returned to work in China after an extended new year holiday even as the country grappled with the epidemic that has now claimed more lives than Severe Acute Respiratory Syndrome (SARS).
“Some people think the outbreak may have a very decelerating impact on growth in China specifically,” said Peter Kenny, founder at Kenny’s Commentary LLC and Strategic Board Solutions LLC in New York.
“But at the end of the day, corporate earnings and U.S. economic data are very strong and we’re seeing more of that confidence being priced into stock performances.”
Wall Street’s main indexes slipped from record highs on Friday, but the S&P 500 posted its best week in eight months.
Of the 324 S&P 500 companies that have reported quarterly results so far, about 71% have beaten earnings estimates, which is above the long-term average of 65%, according to IBES data from Refinitiv.
At 11:34 a.m. ET, the Dow Jones Industrial Average was up 81.65 points, or 0.28%, at 29,184.16 and the S&P 500 was up 12.05 points, or 0.36%, at 3,339.76. The Nasdaq Composite was up 58.56 points, or 0.62%, at 9,579.07.
Ten of the 11 major S&P sectors were higher, with technology stocks climbing 0.7%.
Electric carmaker Tesla Inc rose 2.7% as its Shanghai factory returned to service.
Apple Inc fell marginally as analysts predicted China’s smartphone sales may plunge by as much as 50% in the first quarter due to store closures and production suspensions following the outbreak.
Eli Lilly dropped 2% after experimental drugs from the U.S. pharmaceutical firm and Switzerland’s Roche failed to halt Alzheimer’s disease.
Markets on Monday will also watch for President Donald Trump’s $4.8-trillion budget proposal for fiscal year 2021, and Fed Chair Jerome Powell’s two-day address to the U.S. Congress, starting Tuesday.
Advancing issues outnumbered decliners by a 1.30-to-1 ratio on the NYSE and by a 1.20-to-1 ratio on the Nasdaq.
The S&P index recorded 33 new 52-week highs and two new lows, while the Nasdaq recorded 64 new highs and 67 new lows.
Reporting by Medha Singh and Sruthi Sankar in Bengaluru; Editing by Shounak Dasgupta and Sriraj Kalluvila