Stocks opened higher on optimism surrounding the trade talks with China. The averages gained upside momentum throughout the morning, led by the Dow, which has gained more than 1%. Meanwhile, the Nasdaq is lagging with a gain of about 0.4%. Early economic data was mixed, with industrial production disappointing but a consumer confidence reading beating expectations.
ECONOMIC EVENTS: In the U.S., import prices fell 0.5% in January with export prices dropping 0.6%. The Empire State index rebounded 4.9 points to 8.8 in February. Industrial production dropped 0.6% in January, with capacity utilization sliding to 78.2%, both sharply missing estimates. The preliminary February print from the University of Michigan survey showed the consumer sentiment index was up 4.3 points to 95.5 compared to a 91.2 reading in January.
In trade news, President Donald Trump, speaking from the White House, said the trade talks with China are going "very well," adding that Chinese representatives will be coming to the U.S. in the coming week for additional talks and he plans to meet with Chinese President Xi at "some point after that."
TOP NEWS: Shares of Nvidia (NVDA) have gained 3% following April quarter guidance and commentary on inventory that was called "better than feared" by analysts. Rosenblatt analyst Hans Mosesmann raised his price target for Nvidia to $190 and reiterated a Buy rating on the shares following the Q4 report, stating that the "crypto mess" is finally bottoming in the April quarter and management sees a "material snap-back" starting in fiscal Q2 and the rest of the year.
PepsiCo (PEP) shares are also rising following the company's earnings report, gaining 3% after the snack food and beverage giant reported in-line results for the fourth quarter. Chairman and CEO Ramon Laguarta noted that the company ended the year with 4.6% organic revenue growth in the fourth quarter, adding that he is "excited about the outlook for our business."
Deere (DE), which said its quarter was hurt by higher costs for raw materials and logistics "as well by customer concerns over tariffs and trade policies," posted mixed results, with earnings that missed expectations despite revenues that topped the consensus forecast. Deere shares have slid 2% following the report and guidance from the company about fiscal 2019.
Rivian, an electric truck start-up sometimes compared to Tesla (TSLA), announced an equity investment round of $700M led by Amazon (AMZN). After Rivian announced the news this morning, Bloomberg reported that General Motors (GM) is still said to be in talks to invest in the company as well.
MAJOR MOVERS: Among the noteworthy gainers was Radian (RDN), which rose 8% after Bloomberg reported that Apollo Global Management (APO) and Centerbridge Partners are two investor groups that Radian had talks with last week "before discussions stalled over the terms of a potential deal." Also higher were Talend (TLND) and Arista Networks (ANET), which gained a respective 23% and 8% after reporting quarterly results.
Among the notable losers was SunPower (SPWR), which slid 6% after BofA Merill Lynch analyst Julien Dumoulin-Smith downgraded the stock to Underperform from Neutral. Credit Suisse analyst Michael Weinstein also downgraded SunPower to Neutral from Outperform this morning. Also lower were TrueCar (TRUE) and Applied Materials (AMAT), which fell 23% and 3%, respectively, after reporting quarterly results.
INDEXES: Near midday, the Dow was up 347.58, or 1.37%, to 25,786.97, the Nasdaq was up 28.46, or 0.38%, to 7,455.41, and the S&P 500 was up 23.37, or 0.85%, to 2,769.10.
