Stocks rise to 6-month high on bank earnings, Chevron deal

Stocks jumped to six-month highs on Friday as the U.S. corporate earnings season began with better-than-expected results from the financial sector, led by J.P. Morgan Chase.

The gains were also helped by a jump in Disney after it announced a new streaming video service, which in turn dragged down Netflix stock.

The S&P 500 index rose above the 2,900 level for the first time in six months, and was up for a third straight week, leaving it now less than 1 percent from the all time high seen last October. Of the 11 major sectors in the index, all but healthcare saw gains.

Ticker Security Last Change Change %
I:DJI DOW JONES AVERAGES 35950.89 +520.47 +1.47%
SP500 S&P 500 4567.8 +17.22 +0.38%
I:COMP NASDAQ COMPOSITE INDEX 14226.218266 -32.27 -0.23%

But shares of Well Fargo & Co fell after the lender cut its forecast for 2019 net interest income. PNC Financial Services Group Inc. rose after its first-quarter profit met estimates.

Citigroup and Goldman Sachs are due to report results on Monday.

Sentiment was also helped Friday by a large takeover in the energy sector. Dow index member Chevron announced plans to acquire Anadarko Petroleum for $33 billion in cash and stock. The deal values Andarko at a 37 percent premium to Thursday's closing stock price.

Health-insurer stocks slid for a second day as policy makers in Washington debated proposals that threatened to disrupt their businesses.

Overall, investors expect first-quarter earnings to be weak, with FactSet forecasting S&P 500 index stocks first-quarter earnings down 4.2 percent.

The recovery in U.S. stock prices since December had stalled recently but may resume if first quarter earnings turn out better than expected, though investors remain cautious given concerns about slowing global economic growth.

Ticker Security Last Change Change %
JPM JPMORGAN CHASE & CO. 156.08 +1.76 +1.14%
WFC WELLS FARGO & CO. 44.59 +0.81 +1.85%
CVX CHEVRON CORP. 143.60 -0.31 -0.22%
APC n.a. n.a. n.a. n.a.
DIS THE WALT DISNEY CO. 92.69 +0.19 +0.21%

The ten-year U.S. Treasury note yield rose to the highest level in about a month given the improvement in investor sentiment on early first quarter earnings results, and after Chinese economic data overnight on international trade and on bank credit suggested its economy may not be slowing as much as thought.

Oil prices rose to near six month highs on Friday with fresh sanctions on Venezuela announced Friday by the Trump administration, sanctions against Iran, a civil war in Libya, and OPEC sales cuts all threatening supplies.