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Stocks celebrate phase one trade deal with record highs

Jonathan Garber

U.S. stocks tagged record highs after a signing ceremony for the historic phase one trade deal between the U.S. and China.

All three of the major averages were trading in record territory with the Dow Jones Industrial Average leading the advance.

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Bank earnings continued to roll out with Goldman Sachs reporting a 26 percent drop in fourth-quarter profit amid weakness in its investment banking unit and higher operating costs. Meanwhile, Bank of America’s profit outpaced expectations as bond-trading revenue soared 25 percent year over year to $1.8 billion.

Investment firm BlackRock beat on both the top and bottom lines as its assets under management surged past $7 trillion.

Elsewhere, on the earnings front, health care provider UnitedHealth reported a better-than-expected profit, but missed on revenue.

Target shares were under pressure after the big-box retailer reported holiday sales that fell short of Wall Street estimates and warned that fourth-quarter comparable sales would miss its forecast.

Amazon on Tuesday lifted its ban on third-party sellers using FedEx Ground for shipments, sending shares of the logistics giant higher.

Economic data out Wednesday morning showed producer prices rose 0.1 percent year over year in December, according to the Bureau of Labor Statistics. That was below the 0.2 percent gain that economists surveyed by Refinitiv were expecting.

Looking at commodities, gold was up 0.8 percent near $1,557 an ounce and West Texas Intermediate crude oil was down 0.5 percent at $57.99 a barrel after weekly data showed an unexpected inventory build .

U.S. Treasurys gained, lowering the yield on the 10-year note by 2.6 basis points to 1.792 percent.

In Europe, Britain’s FTSE was up 0.3 percent while France’s CAC and Germany’s DAX were weaker by 0.1 percent and 0.2 percent, respectively.

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Markets were broadly lower across Asia with China’s Shanghai Composite and Japan’s Nikkei both down 0.5 percent and Hong Kong’s Hang Seng off 0.4 percent.

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