Wall Street rises as Fed's Williams cements rate-cut expectations

The Netflix logo is seen on their office in Hollywood Los Angeles California

The Netflix logo is seen on their office in Hollywood Los Angeles California

Major indices turned up into green territory in the afternoon after New York Federal Reserve President John Williams said "it pays to act quickly to lower rates at the first sign of economic distress".

Williams said that when rates and inflation are low, policymakers can not afford to keep their "powder dry" and wait for potential economic problems to materialise.

"He's toeing the party line at the Fed, basically implying that an insurance rate cut is the right thing to do for the economy at this point in time", said Chris Zaccarelli, chief investment officer at Independent Advisor Alliance in Charlotte, North Carolina, referring to Williams' comments.

US stock indexes edged lower on Thursday as investors awaited more developments around trade, while Netflix posted a surprise drop in USA subscribers, kicking off earnings for the FAANG group of stocks on a sour note. The Nasdaq Composite was down 25.62 points, or 0.31%, at 8,159.59. "I think that investors have viewed these large-cap growth technology companies as somewhat defensive".

Railroad operator Union Pacific rose 4.5% after reporting earnings that came in well ahead of what analysts were expecting.

The Dow Jones Industrial Average .DJI rose 8.61 points, or 0.03%, to 27,228.46, the S&P 500 .SPX gained 9.48 points, or 0.32%, to 2,993.9 and the Nasdaq Composite .IXIC added 17.75 points, or 0.22%, to 8,202.95.

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EBay Inc jumped 5.4% after the e-commerce company posted better-than-expected quarterly revenue and profit, helped by growth in its advertising and payments businesses. Morgan Stanley rose 0.7% after posting a better-than-expected quarterly profit and wrapped up earnings from big United States banks.

Analysts now estimate S&P 500 year-on-year quarterly earnings will decline 0.1 per cent, according to Refinitiv.

UnitedHealth Group Inc fell 2.2% following comments that the insurer would continue with its point-of-sale rebates, a week after the Trump administration pulled back an ambitious proposal to ban drug rebates.

Traders work on the floor of the New York Stock Exchange shortly after the opening bell in New York, U.S., July 12, 2019.

Declining issues outnumbered advancers for a 1.20-to-1 ratio on the NYSE and for a 1.05-to-1 ratio on the Nasdaq.

The S&P index recorded 18 new 52-week highs and four new lows, while the Nasdaq recorded 39 new highs and 63 new lows.

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