USA stocks end mostly up as Boeing surges

USA stocks end mostly up as Boeing surges

USA stocks end mostly up as Boeing surges

The Dow rose 59.70 points, or 0.2 percent, at 24,083.83.

The CBOE Volatility index, a gauge of short-term stock market volatility jumped to more than 1-week high to 18.69 points. The Nasdaq Composite Index ended virtually flat at 7,004, down less than 0.1%.

United States stocks tumbled Tuesday after a warning from executives of the industrial giant Caterpillar scared investors and the 10-year Treasury yield climbed to 3 percent for the first time since 2014. That means costs for companies are up.

Then Caterpillar executives told analysts on a conference call in the late morning that they don't expect the company to report a larger per-share profit for the rest of 2018. On Wednesday Goodyear Tire & Rubber said higher raw materials costs and weaker demand hurt its business in the first quarter. USA bond yields rose again and set four-year highs while oil prices, already at three-year highs, continued to move higher.

Other companies, including Lockheed and 3M, also gave disappointing updates, adding to the sting of rising Treasury yields. Stock indexes in Europe and Asia are also taking losses.

Wall Street had cheered Caterpillar's results earlier in the day after the company had a strong first quarter and raised its forecasts for the year.

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Stocks shot up at the end of 2017 and the start of 2018 as investors bet that the corporate tax overhaul would lead to bigger profits for American companies and greater economic growth. Gina Martin Adams, chief equity strategist for Bloomberg Intelligence, said that hasn't happened yet.

"Fears of "peak earnings" are laughable considering that the average constituent in the S&P 500 has enjoyed year-over-year bottom line growth in excess of 20%", Klein wrote in a note.

The S&P 500 is down 39.05 points, or 1.5 percent.

The yield on 10-year U.S. Treasury notes, the benchmark for global interest rates, held above 3 percent after crossing the level for the first time in four years on Tuesday, stoking concerns about higher borrowing rates for companies. According to Kensho, an analytics company, Caterpillar's stock has had a 0.81 correlation with the Dow over the last six months. The stock market had already been spooked by a climb in bond yields earlier in the year, sliding sharply in February. The stock tumbled nearly 4% Tuesday after higher expenses at Google parent Alphabet raised concerns about profitability for the tech titans. Natural gas rose 1.5 percent to $2.78 per 1,000 cubic feet.

The Nasdaq is down 138.77 points, or 1.9 percent.

Benchmarks in Hong Kong and South Korea fell as much as 1% by midday, while a number of other markets logged declines of at least 0.5%. Scandal-hit Facebook which is set to report after market on Wednesday, was down 0.14 percent.

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