Netflix leads Wall Street higher, recovering this year's losses

Stocks on Wall Street continued to respond to strong corporate results, sending the Dow industrials back into positive territory for 2018.

The gains extended Monday’s rally for the eighth day of gains in the past 11 trading sessions.

Volumes, however, have been light, suggesting some investors are remaining on the sidelines as geopolitical tensions simmer.

At the close, the Dow Jones Industrial Average climbed 213.59 points, or 0.9%, to 24,786.63. The S&P 500 added 1.1% to 2706.39 as 10 of the index’s 11 sectors traded higher. The tech-heavy Nasdaq rose 1.7% to 7281.10.

The Dow is up 0.3% for the year while the S&P 500 has gained 1.2% and the Nasdaq Composite has risen 5.5%.

Leading the action, Netflix shares jumped 9.2% after the video streaming service reported subscriber growth that beat its own forecast. The stock is by far the best performer in the S&P 500 this year, up 75%.

“The FANGs [Facebook, Amazon.com, Netflix and Google‘s parent Alphabet] are very important; they seem to be a barometer for all stocks,” says Christopher Peel, chief investment officer at Tavistock Investments.

“The tech sector is vulnerable to a selloff if any of the big five or six companies have a miss [on earnings].”

Shares of the FANG stocks each gained more than 2%.

Results from Netflix are also the first real gauge of whether worldwide consumer demand picked up in the first quarter, says JJ Kinahan, chief market strategist at TD Ameritrade.

“You really want to hear that tech stocks are doing well, and seeing demand and growth worldwide.”

Goldman falls after rejecting buyback 
Among other companies posting results, Goldman Sachs shares fell 1.7% after the bank said it wouldn’t buy back shares in the second quarter, though it reported higher profit and revenue than expected.

Goldman helped drive down financial stocks in the S&P 500, which were the only sector in the red, as Treasury yields also slumped.

The yield on the 10-year Treasury note settled at 2.814%, compared with 2.834% on Monday. 

Meanwhile, UnitedHealth Group, the biggest US health insurer, rose 3.6% after reporting a 31% increase in earnings. 

The Stoxx Europe 600 added 0.8%. The UK's multinational heavy FTSE 100 edged up 0.4% after grappling with a strengthening pound. France's CAC 40 rose 0.8% and Germany's DAX 1.6%.

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