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July 15, 2020, 4:37 p.m. EDT

Dow ends 228 points higher as vaccine optimism outshines rising coronavirus cases

Apple shares eke out gain, after EU court battle win over $15 billion tax bill

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By Sunny Oh and Joy Wiltermuth

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Arone also sees “overly pessimistic” forecasts for the COVID-19 damage to corporate earnings. “I think companies can easily step over negative earnings expectations,” he said. “We could see some pleasant surprises in this earnings season, which could keep momentum for stocks going.”

On Wednesday, Dow component Goldman Sachs Group Inc. /zigman2/quotes/209237603/composite GS -0.80% /zigman2/quotes/209237603/composite GS -0.80% delivered second-quarter results that beat expectations for earnings, with shares ending 1.4% higher. The bank also reported its second highest revenues in history.

Related : Major banks are hauling in ‘big fees’ from debt and equity underwriting during the coronavirus crisis

“The way bank earnings have been coming in has impressed me,” said Randall Eley, president and chief investment officer at Edgar Lomax Co in Alexandria, Virginia. “Overall, they just aren’t reporting the kind of negative numbers people feared.”

Eley also expects that today’s higher bank reserves, or the cushion lenders keep to buffer against any potential credit losses, will end up being “well beyond what will be needed.”

In other U.S. economic data Wednesday, the New York Reserve Bank’s regional Empire State Index for July posted its first positive reading since February. Industrial production in June jumped by 5.4%, on top of the 1.4% gain in May. Wall Street economists had forecast a 4.1% increase, according to a MarketWatch survey.

Philadelphia Fed President Patrick Harker also on Wednesday said he would support a change in monetary policy where the central bank would let the economy run hot until inflation rises above the central bank’s 2% annual target before lifting interest rates.

Which companies were in focus?

  • Apple Inc. /zigman2/quotes/209237603/composite GS -0.80% shares gained 0.7% after the iPhone maker won a court battle with the European Union in a dispute over a €13 billion ($15 billion) Irish tax bill.

  • Dow component UnitedHealth Group Inc. /zigman2/quotes/210453738/composite UNH +0.54%  shares fell 1.4% after the health care company reported a second-quarter profit that rose well above expectations, but revenue that came up short, as premiums and services revenue missed

  • Moderna /zigman2/quotes/205619834/composite MRNA +0.65%  shares surged 6.9% after the company’s positive vaccine announcement.

  • Amazon.com Inc. /zigman2/quotes/210331248/composite AMZN -0.25%   said it would create 1,000 new full-time jobs as it plans to open a new fulfillment center in Pflugerville, Texas. The e-commerce giant’s shares fell 2.4%.

  • Walmart Inc. /zigman2/quotes/207374728/composite WMT -0.09%   announced that face coverings will be required at all U.S. stores and Sam’s Club warehouses starting July 20. Its shares ended 0.01% lower.

  • Relay Therapeutics Inc . /zigman2/quotes/219481362/composite RLAY -2.17% , a clinical-stage oncology biotech, upsized and raised its expected price range for its initial public offering on Wednesday, with plans to offer 20 million shares priced at $18 to $19 each.

  • J .C. Penney Co. Inc . /zigman2/quotes/207971682/delayed DE:JCP -2.77%   shares gained 2% after the retailer said it would cut about 1,000 jobs as it looks to closes 152 stores as part of its restructuring.

  • Forescout Technologies Inc .  rallied 15.4% Wednesday after the cybersecurity company said its deal to be taken private by Advent International was back on but at a lower price.

How did other markets trade

In Asia, the Shanghai Composite /zigman2/quotes/210598127/delayed CN:SHCOMP +0.21%  fell 1.6% to end at 3,361.30, while the CSI 300 Index /zigman2/quotes/210598128/delayed XX:000300 +0.22%  fell 1.3%. Japan’s Nikkei 225 Index /zigman2/quotes/210597971/delayed JP:NIK +0.12%  lost 1.6%, while the Hang Seng Index in Hong Kong /zigman2/quotes/210598030/delayed HK:HSI -0.85%  eked out a gain of 3.69 points to close at 25,481.58.

In Europe, the pan-European /zigman2/quotes/210599654/delayed XX:SXXP -0.23%  Stoxx 600 Europe Index settled 1.8% higher, while London’s FTSE 100 /zigman2/quotes/210598409/delayed UK:UKX -0.25% was up 1.8%.

The yield on the benchmark 10-year Treasury note /zigman2/quotes/211347051/realtime BX:TMUBMUSD10Y -1.98%  rose 1.5 basis points to 0.629%. Yields and bond prices move in opposite directions. The ICE U.S. Dollar Index /zigman2/quotes/210598269/delayed DXY -0.35% , a measure of the currency against a basket of six major rivals, was off 0.2%.

Oil futures rose, with the U.S. benchmark /zigman2/quotes/211629951/delayed CL.1 -1.82% adding 91 cents, or 2.3%, to settle at $41.20 a barrel, on the New York Mercantile Exchange. Gold /zigman2/quotes/210034565/delayed GC00 +0.53%  futures added 40 cents, or 0.02%, to end at $1,813.80 an ounce.

<STRONG>William Watts contributed reporting</STRONG>

/zigman2/quotes/209237603/composite
US : U.S.: NYSE
$ 197.47
-1.60 -0.80%
Volume: 232,264
Sept. 29, 2020 9:56a
P/E Ratio
14.98
Dividend Yield
2.54%
Market Cap
$68.50 billion
Rev. per Employee
$1.34M
loading...
/zigman2/quotes/209237603/composite
US : U.S.: NYSE
$ 197.47
-1.60 -0.80%
Volume: 232,264
Sept. 29, 2020 9:56a
P/E Ratio
14.98
Dividend Yield
2.54%
Market Cap
$68.50 billion
Rev. per Employee
$1.34M
loading...
/zigman2/quotes/209237603/composite
US : U.S.: NYSE
$ 197.47
-1.60 -0.80%
Volume: 232,264
Sept. 29, 2020 9:56a
P/E Ratio
14.98
Dividend Yield
2.54%
Market Cap
$68.50 billion
Rev. per Employee
$1.34M
loading...
/zigman2/quotes/210453738/composite
US : U.S.: NYSE
$ 304.86
+1.63 +0.54%
Volume: 117,422
Sept. 29, 2020 9:56a
P/E Ratio
17.09
Dividend Yield
1.65%
Market Cap
$288.17 billion
Rev. per Employee
$754,157
loading...
/zigman2/quotes/205619834/composite
US : U.S.: Nasdaq
$ 71.01
+0.46 +0.65%
Volume: 516,724
Sept. 29, 2020 9:56a
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$27.84 billion
Rev. per Employee
$177,721
loading...
/zigman2/quotes/210331248/composite
US : U.S.: Nasdaq
$ 3,166.20
-7.85 -0.25%
Volume: 415,709
Sept. 29, 2020 9:56a
P/E Ratio
122.31
Dividend Yield
N/A
Market Cap
$1589.85 billion
Rev. per Employee
$359,671
loading...
/zigman2/quotes/207374728/composite
US : U.S.: NYSE
$ 137.13
-0.13 -0.09%
Volume: 589,644
Sept. 29, 2020 9:56a
P/E Ratio
21.90
Dividend Yield
1.57%
Market Cap
$388.93 billion
Rev. per Employee
$223,654
loading...
/zigman2/quotes/219481362/composite
US : U.S.: Nasdaq
$ 37.19
-0.82 -2.17%
Volume: 24,008
Sept. 29, 2020 9:53a
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$3.42 billion
Rev. per Employee
N/A
loading...
/zigman2/quotes/207971682/delayed
DE : Germany: Frankfurt
0.21
-0.0060 -2.77%
Volume: 0.00
Sept. 29, 2020 8:09a
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
N/A
Rev. per Employee
N/A
loading...
/zigman2/quotes/210598127/delayed
CN : China: Shanghai
3,224.36
+6.82 +0.21%
Volume: 15.13B
Sept. 29, 2020 3:01p
loading...
/zigman2/quotes/210598128/delayed
XX : China Securities Index
4,591.80
+9.89 +0.22%
Volume: 8.60B
Sept. 29, 2020 3:00p
loading...
/zigman2/quotes/210597971/delayed
JP : Nikkei
23,539.10
+27.48 +0.12%
Volume: 0.00
Sept. 29, 2020 3:15p
loading...
/zigman2/quotes/210598030/delayed
HK : Hong Kong Exchange
23,275.53
-200.52 -0.85%
Volume: 1.53M
Sept. 29, 2020 4:08p
loading...
/zigman2/quotes/210599654/delayed
XX : STOXX
362.55
-0.84 -0.23%
Volume: 0.00
Sept. 29, 2020 3:41p
loading...
/zigman2/quotes/210598409/delayed
UK : FTSE UK
5,912.85
-15.08 -0.25%
Volume: 257,190
Sept. 29, 2020 2:41p
loading...
/zigman2/quotes/211347051/realtime
add Add to watchlist BX:TMUBMUSD10Y
BX : Tullett Prebon
0.65
-0.01 -1.98%
Volume: 0.00
Sept. 29, 2020 9:56a
loading...
/zigman2/quotes/210598269/delayed
US : U.S.: ICE Futures U.S.
93.95
-0.33 -0.35%
Volume: 0.00
Sept. 29, 2020 9:46a
loading...
/zigman2/quotes/211629951/delayed
US : U.S.: Nymex
$ 39.86
-0.74 -1.82%
Volume: 114,338
Sept. 29, 2020 9:46a
loading...
/zigman2/quotes/210034565/delayed
US : U.S.: Nymex
$ 1,892.30
+10.00 +0.53%
Volume: 123,285
Sept. 29, 2020 9:46a
loading...

Sunny Oh is a MarketWatch fixed-income reporter based in New York. Joy Wiltermuth is a MarketWatch markets reporter and editor based in New York.

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