Banks, AT&T push US stocks broadly higher in morning trading

FILE - In this Sept. 4, 2019, file photo trader Michael Milano works on the floor of the New York Stock Exchange. The U.S. stock market opens at 9:30 a.m. EDT on Monday, Sept. 9. (AP Photo/Richard Drew, File)

Stocks edged higher in morning trading Monday as rising bond yields lifted banks and AT&T led gains in the communications sector

NEW YORK — U.S. stocks edged higher in morning trading Monday as rising bond yields lifted banks and AT&T powered gains in the communications sector.

AT&T soared in heavy trading after activist investor Elliott Management announced a $3.2 billion stake in the company and called for a shakeup. The communications company did much of the heavy lifting for the sector. Netflix and Google also made big gains.

JPMorgan Chase rose 2.4% and Bank of America rose 2.9% as bond yields jumped. Banks rely on higher yields to set more lucrative interest rates on loans.

The yield on the 10-year Treasury rose to 1.62% from 1.55% late Friday in a sign that investors remain confident that the economy will continue growing. They also shifted money out of safe-play sectors like utilities and makers of consumer products.

Oil prices ticked higher and helped lift energy stocks. Oilfield services company Schlumberger rose 4.1% and Halliburton rose 4.3%.

Health care stocks were the biggest losers in the early going, dragged down by drug developers Merck and Amgen.

The broader market is coming off of two weeks of gains following a bout of volatility brought on by the trade war between the U.S. and China. Investors are still hoping for some kind of a deal between the two nations, and were encouraged last week by news that talks will resume in October.

A mixed bag of economic data has kept Wall Street focused on central banks and whether they will continue taking measures to shore up economic growth. On Friday, Federal Reserve Chairman Jerome Powell said the central bank doesn't expect a recession and will take necessary actions to maintain growth. Economists expect the Fed to cut interest rates when it meets next week.

KEEPING SCORE: The S&P 500 rose 0.2% as of 11:35 a.m. Eastern time. The Dow Jones Industrial Average rose 86 points, or 0.3%, to 26,884. The Nasdaq rose 0.2%. Small-company stocks did better than the rest of the market. The Russell 2000 rose 1%.

OVERSEAS: Stocks in Europe were mixed as economic growth concerns and Britain's potentially chaotic exit from the European Union weigh on investors. The European Central Bank is expected to unveil new monetary stimulus measures on Thursday to help shore up economic growth.

Stocks in Asia were broadly higher. The Shanghai Composite rose 0.8% as investors brushed off the latest trade data showing a drop in imports from and exports to the U.S. amid a damaging trade war.

CALLING FOR CHANGE: AT&T jumped 3.1% after investment manager Elliott Management sent a letter to the company's board noting that its stock has badly lagged the broader market over the past 10 years and urged it to shed businesses and trim costs. AT&T said it will review the proposals.

GOOD HEALTH: Acadia Pharmaceuticals surged 62.4% after the drug developer said its potential treatment for dementia-related psychosis met a key study goal. It plans to meet with the Food and Drug Administration in 2020 regarding possible approval, which could make it the first drug approved by the FDA to specifically treat the condition.

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