Wall Street closes higher boosted by energy and tech
- Strong rebound in oil prices lifted energy shares on Tuesday.
- Google Alphabet's upbeat earnings figures carry Nasdaq to record highs.
- Agriculture-related sector responds positively to USDA announcement.
Major equity indexes in the U.S. started the day on a positive note on Tuesday led by sharp gains in technology stocks that were inspired by Google Alphabet's upbeat Q2 earnings results. The S&P Information Technology Index (SPLRCT) closed the day at a record high of 1,290 as it added 0.5% on the day.
"It has been a very good year for earnings and stock prices have not reflected the earnings potential. With all the talk of tariffs and trade negotiations denting earnings, so far we have not seen its impact and therefore markets are responding very favorably," Jamie Cox, managing director for Harris Financial Group Richmond, Virginia, told Reuters.
Meanwhile, the barrel of West Texas Intermediate made a strong comeback on Tuesday to settle at $68.52 with a gain of nearly $1. Boosted by rising crude oil and metal prices, the S&P 500 Energy Index (SPNY) rose 1.3%.
Furthermore, the U.S. Agriculture Department secretary Sonny Perdue announced a $12 billion worth of assistance program to help farmers hurt by the U.S. tariffs to provide an additional boost to the major indices. The Dow Jones Industrial Average gained 194.14 points, or 0.78%, to 25,238.42, the S&P 500 added 12.99 points, or 0.46%, to 2,819.67. After reaching an all-time high, the Nasdaq Composite erased its gains amid profit taking and close virtually unchanged at 7,480.
DJIA Technical Outlook (via FXStreet Chief Analyst Valeria Bednarik)
"The Dow heads into the Asian opening at its highest settlement since mid-June, maintaining a bullish stance in its daily chart, given that technical indicators picked up after a modest downward correction within positive levels, while the index firmed up above all of its moving averages, with the 20 DMA aiming to surpass the 200 DMA after already advancing above the 100 DMA."
"Shorter term, and according to the 4 hours chart, the index is also poised to extend its advance, developing above all of its moving averages and with the 100 SMA above the 200 SMA for the first time since July 1, as technical indicators turned higher after a modest downward correction, holding well into positive territory."
According to the analyst, supports could be seen at 25,181, 25,132, and 25,076 while resistances align at 25,241, 25,283, and 25,329.