Tom Cassidy, chief investment officer at Univest Wealth Management Division, was featured in Reuters
July 19, 2017
By: Tanya Agrawal, Reuters
The Nasdaq and the S&P traded at record levels in late morning trading on Wednesday, powered by technology and healthcare stocks, while IBM capped gains on the Dow.
IBM fell 3.7 percent after the company's quarterly revenue came in below expectations. The stock was the biggest drag on the Dow and the S&P 500.
The S&P tech sector has been the best performing sector this year despite concerns about stretched valuations as investors look for growth sectors immune to policy uncertainties.
"At least in the second quarter and for the next quarter technology is the only sector that will see double-digit growth," said Tom Cassidy, chief investment officer at Univest Wealth Management Division.
"If you look at the sector, it isn't all that overvalued compared to the broader S&P index, except for a few names."
Microsoft and Facebook were among the top-three boosts to the S&P and the Nasdaq.
At 10:53 a.m. ET (1453 GMT), the Dow Jones Industrial Average was up 18.48 points, or 0.09 percent, at 21,593.21, the S&P 500 was up 6.09 points, or 0.24 percent, at 2,466.70.
The Nasdaq Composite was up 25.51 points, or 0.4 percent, at 6,369.81.
Seven of the 11 major S&P 500 sectors were higher, with the health index's 0.55 percent rise leading the advancers.
Vertex Pharmaceuticals jumped 22 percent after the company reported positive results for its cystic fibrosis treatment. The stock was the biggest boost on the S&P and the Nasdaq.
Investors will continue to focus on quarterly earnings to see if high valuations are justified in the face of mixed economic data, tepid inflation and policy gridlock in Washington.
Analysts estimate an 8.7 percent rise in second-quarter earnings and a 4.6 percent increase in revenue for the S&P 500 companies from a year earlier, according to Thomson Reuters I/B/E/S.
This follows a robust first quarter when U.S. companies posted the fastest rate of growth in earnings since 2011.
"Earnings so far have been good and even though they aren't as stellar as the first quarter, we still expect earnings to grow in double digits for the year," said Cassidy.
Morgan Stanley rose 3 percent after the Wall Street bank reported better-than-expected profit and bond trading revenue declines that were modest compared with arch-rival Goldman Sachs'.
CSX fell 5.2 percent after the third-largest U.S. railroad operator's forecast missed expectations. The stock was among the top drags on the S&P and the Nasdaq.
Advancing issues outnumbered decliners on the NYSE by 2,050 to 706. On the Nasdaq, 1,776 issues rose and 841 fell. (Reporting by Tanya Agrawal; Editing by Arun Koyyur)
View the original article at: https://www.reuters.com/article/us-global-markets-idUSKBN1A901O
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