U.S. stocks are climbed Thursday following reports of solid earnings from railroad operator CSX. Banks, technology companies, industrial and materials firms and energy companies all rallied as a strong day of corporate results has investors feeling better about the economy. The Nasdaq composite had another record high close.
ON WALL STREET: At the close, the Standard & Poor’s 500 index advanced 17.7 points, about 0.8 percent, to 2,355.8. The Dow Jones industrial average was up 174.2 points, about 0.85 percent, to 20,578.7. The Nasdaq composite gained 53.7 points, about 0.9 percent, to 5,916.8. The Russell 2000 index of smaller-company stocks added 17 points, about 1.2 percent, to 1,384.2.
CSX EXCEEDS EXPECTATIONS: Railroad company CSX announced a bigger profit and more revenue than Wall Street expected in the first quarter. CSX also said restructuring and spending cuts will increase its profit by about 25 percent this year. The company is cutting jobs and reorganizing after it hired Hunter Harrison, former head of Canadian Pacific, as its new CEO last month. The company also said it will buy back more stock and raise its dividend. CSX stock jumped $2.46, or 5.2 percent, to $49.39.
Railroads and transportation companies like trucking companies and airlines rose. Industrial companies were among the top performers Thursday.
ANALYST’S VIEW: It’s still early in this round of company earnings reports, but experts and investors are encouraged that companies are feeling good about the economy. “The major take-away so far to earnings season is the CEOs are still saying we’re poised for growth,” said analyst J.J. Kinahan, chief market strategist at TD Ameritrade. “Last quarter was sort of the first time we heard this theme.”
OIL PRICES: At the close, energy prices wobbled and finished lower. Benchmark U.S. crude slipped 18 cents to $50.26 a barrel on the New York Mercantile Exchange. In London on the Intercontinental Exchange Europe, Brent crude, the international standard, was off 6 cents at $52.87 a barrel.
OCWEN DIVES: State and federal authorities sued Ocwen Financial and said the mortgage lender botched the handling of millions of accounts. The Consumer Financial Protection Bureau said Ocwen generated errors in borrowers’ accounts, failed to credit payments, illegally foreclosed on homeowners, and charged borrowers for products without their consent. Ocwen is one of the nation’s largest non-bank mortgage lenders, focusing mostly on subprime and delinquent mortgages. Its stock closed down $2.91, about 53.9 percent, at $2.49 in heavy trading.