FILE - In this Feb. 5, 2020, file photo trader Ashley Lara works on the floor of the New York Stock Exchange. The U.S. stock market opens at 9:30 a.m. EST on Wednesday, Feb. 19. (AP Photo/Richard Drew, File)

Tech companies lead US stocks higher as virus fears subside

February 19, 2020 - 10:32 am

NEW YORK (AP) — Technology companies led stocks higher in early trading Wednesday as investors set aside some of their concerns about the virus outbreak that originated in China.

New cases of the virus fell for a second straight day. China’s top diplomat told counterparts in Southeast Asia that the situation “is under effective control” in the province where the outbreak is centered.

The early gains mark a reversal from Tuesday when tech stocks led the market lower after Apple warned that its revenue would take a hit because of the outbreak. Apple rose 1% and chipmaker Nvidia jumped 4.2%.

Bond prices fell, pushing yields higher. The yield on the 10-year Treasury rose to 1.57% from 1.55% late Tuesday. JP Morgan Chase, Bank of America and other banks climbed.

Navigation device maker Garmin and chipmaker Analog Devices jumped after reporting strong earnings. Safe-play assets like real estate companies and utilities lagged behind.

KEEPING SCORE: The S&P 500 index rose 0.4% as of 10:30 a.m. Eastern time. The Dow Jones Industrial Average rose 64 points, or 0.2%, to 29,298. The Nasdaq rose 0.7%. The Russell 2000 index of smaller company stocks rose 0.3%. Markets in Europe and Asia climbed.

FRESHENING THE PILLOWS: Bed Bath & Beyond rose 4.1% after the home goods retailer rolled out initiatives to turn the struggling chain around. The company will spend $1 billion this year reinvesting in stores, upgrading technology, and on debt reduction and share buybacks. The moves come a month after the company withdrew its annual financial forecast because of weak results.

SOLID CONSTRUCTION: Several homebuilders gained ground following a surprisingly good government report on new home construction. The report also showed that applications for building permits jumped 9.2% in January. Beazer Homes rose 1.8% and Hovnanian Enterprises rose 1.4%.

VIRUS UPDATE: The virus has now infected more than 75,000 people globally, though the overwhelming majority of them are in China. Scientific instrument maker Agilent, which gets about 19% of its revenue from there, is the latest company to warn that the virus’ economic impact will hurt profits.

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