NEW YORK (AP) — U.S. stocks are hanging near their records Tuesday after Chinese stocks soared following a slew of moves by the Chinese central bank to prop up the world’s second-largest economy.
The S&P 500 was 0.1% higher in early trading, a day after setting an all-time high for the 40th time this year. The Dow Jones Industrial Average was up 76 points, or 0.2%, and likewise coming off a record. The Nasdaq composite was 0.2% higher, as of 9:35 a.m. Eastern time.
Financial markets have been mostly ebullient after the Federal Reserve made a drastic turn last week in how it sets interest rates. It’s now lowering rate to make things easier for the U.S. economy after keeping them high for years in hopes of slowing the economy enough to extinguishing high inflation.
One of the risks still hanging over the market, though, is the struggling Chinese economy and how much its flagging growth may affect the rest of the world. After earlier delivering some modest and piecemeal moves, the chief of China’s central bank on Tuesday announced a broad set of changes to bolster its economy, including a reduction in the amount of reserves banks are required to keep.
Analysts called the coordinated moves encouraging, and they helped stocks soar in China. Indexes jumped 4.2% in Shanghai and 4.1% in Hong Kong. But questions still remain about how much they will boost the economy, which has been struggling since Chinese authorities cracked down ago on excessive borrowing by property developers.
Prices for oil and other commodities that a healthy Chinese economy would devour nevertheless climbed. A barrel of benchmark U.S. crude oil gained 2.2%. Brent crude, the international standard, rose 2.4%.
Copper climbed 3%.
On Wall Street, stock indexes were drifting in quiet trading in what may prove to be a relatively quiet week. A few reports on the economy are due, including an update on U.S. consumer confidence later Tuesday morning. But none will directly address what’s become the top concern among investors: the slowing U.S. job market.
Now that inflation has eased substantially from its peak two summers ago, the worry is that a slowdown in hiring by U.S. companies may worsen.
Moves to interest rates can take a notoriously long time to make their way fully through the economy, and the Federal Reserve had been keeping its main interest rate at a two-decade high for more than a year before last week. It did cut by an unusually large amount in hopes of providing relief to the job market and economy.
Reports due later this week include Thursday’s final revision on how much the U.S. economy grew in the spring. On Friday, a report will show how strong spending by U.S. consumers remains. That is the main engine of the U.S. economy.
Autozone’s stock fell 3.6% after saying a key measure of its sales performance among its U.S. stores barely grew during the latest quarter. It was part of an underwhelming report where its profit and revenue both fell short of analysts’ expectations.
The seller of auto replacement parts and accessories said its U.S. stores continue to see customers delay purchases of non-essentials.
Another company that depends on the appetite of U.S. shoppers for non-essentials, Thor Industries, was rising 1% following a mixed profit report. The maker of recreational vehicles reported better profit and revenue for the latest quarter, but it also gave a forecast for its upcoming fiscal year that sees the RV market continuing to be challenging.
“The talk of a softer market is beginning to sound like a broken record, but we remained focused on managing through it with increasing efficiency,” CEO Bob Martin said.
In the bond market, Treasury yields ticked higher. The 10-year yield rose to 3.78% from 3.75% late Monday. The two-year yield, which more closely tracks expectations for the Fed’s upcoming moves, was holding steady at 3.59%, where it was late Monday.
In stock markets abroad, indexes rose across much of Europe and Asia. France’s CAC 40 jumped 1.3%, South Korea’s Kospi rose 1.1% and Japan’s Nikkei 225 added 0.6%.
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AP Writers Elaine Kurtenbach and Matt Ott contributed.
