Stocks rise as risk outlooks improve across Europe and Asia
- Stocks rallied on Wednesday as a series of geopolitical risks across Europe and Asia appeared to soften.
- Hong Kong leader Carrie Lam said she withdrew the controversial extradition bill that sparked weeks of protests throughout the city. Hong Kong stocks rose about 4% on the news.
- UK lawmakers voted in favor to block Prime Minister Boris Johnson's brexit strategy, allaying fears that Britain might leave the European Union without a deal.
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Stocks rebounded on Wednesday as traders found relief in a broad-softening of geopolitical risks across Europe and Asia.
Hong Kong leader Carrie Lam said she formally withdrew a controversial extradition bill that incited weeks of protests around the city. Hong Kong stocks jumped about 4% on the news.
The move was seen as a major easing of political tensions in Hong Kong. Some investors were growing worried the tensions could both hurt trade negotiations between the US and China and drag the global economy closer to a recession.
UK lawmakers moved to block Prime Minister Boris Johnson's brexit plan, soothing concerns that Britain could exit the European Union without a formalized deal. If the law passes the House of the Lords, it would force Johnson to request a three-month delay on the UK's departure from the EU.
Investors have been jumpy over the last several weeks as a combination of geopolitical tensions throughout Europe and Asia, bumpy US-China trade negotiations, and mixed economic data has clouded the outlook for the global economy.
Here's a look at the major indexes as of the 4 p.m. close on Wednesday:
- The S&P 500 rose 1.08%, to 2,937.78.
- The Dow Jones Industrial Average climbed 0.91%, to 26,355.47.
- The Nasdaq Composite jumped 1.3%, to 7,976.88.
Shares of Starbucks fell as much as 3.9%- the most in seven months - after the company said during an investor presentation that it expects earnings per share growth will slip below its 10% forecast in 2020. The company referenced normalized share repurchasing volume and the lapse of a one-time tax benefit as the justification for the drop in growth.
Walmart's stock price climbed 1.1% to a record high after the retailer announced a major restructuring of its policies for gun sales in response to deadly mass shootings in two of its stores.
Walmart chief executive officer Doug McMillon said in a memo to employees that the company would stop selling short-barrel rifle and handgun ammunition. The company also said its "respectfully requesting" that shoppers stop openly carrying firearms in Walmart locations.
Within the S&P 500, these were the largest gainers:
- PVH Corp: 9.1%
- IPG Photonics: 6.3%
- General Electric: 5.6%
And the largest decliners:
- Tyson Foods: (-7.8%)
- Ulta Beauty: (-3.6%)
- Incyte: (-3%)
Every sector in the S&P 500 rose on Wednesday. Communications services stocks climbed 1.6%, and the information technology sector rose 1.7%. Energy and industrials rose more than 1.3%.