Wall St. rises as financials lead before earnings

By Kimberly Chin

(Reuters) - Wall Street rose modestly on Thursday afternoon, helped by gains in financials ahead of profit reports from several big U.S. banks Friday.

The financial index <.SPSY> was the highest performer among the 11 major S&P sectors, rising 0.48 percent.

Quarterly earnings kick off on Friday with three of the biggest U.S. banks including JPMorgan Chase , Wells Fargo and Citigroup reporting results.

Analysts estimate second-quarter earnings for S&P 500 companies rose 7.8 percent from a year ago. Companies had their best profit performance since 2011 in the first quarter, according to Thomson Reuters I/B/E/S.

The S&P 500 healthcare index <.SPXHC> was up 0.23 percent, showing little reaction to U.S. Senate Majority Leader Mitch McConnell's unveiling of a revised healthcare bill.

 

"Even if this bill is passed, there will be multiple iterations of healthcare legislation to come," said Jamie Cox, managing partner at Harris Financial Group.

"This is not a watershed moment like the Affordable Care Act, where it altered the healthcare industry," he said.

Hospital and insurer groups have been vocal against proposed Medicaid cuts which could result in lower revenues for hospitals like Community Health Systems Inc and Medicaid insurance specialists like Molina Healthcare and Centene Corp .

Investors are eager to move past the healthcare bill and onto comprehensive tax reform, though Congress's ability to address it soon are in doubt, Cox said.

The Dow Jones Industrial Average <.DJI> rose 16.86 points, or 0.08 percent, to 21,549, the S&P 500 <.SPX> gained 4.22 points, or 0.17 percent, to 2,447.47 and the Nasdaq Composite <.IXIC> added 10.28 points, or 0.16 percent, to 6,271.45.

Federal Reserve Chair Janet Yellen told a Senate panel on Thursday that it would be "quite challenging" for U.S. growth to reach a 3-percent target set by President Donald Trump.

Delta Air Lines Inc on Thursday reported a 21 percent drop in second-quarter profit because of sharply higher operating costs, despite higher passenger unit revenue, sending its shares down about 1.7 percent.

Target Corp rose 4.2 percent after an upbeat second-quarter forecast. The news boosted other retailers, with Wal-Mart up 1.4 percent and Costco edging up 0.9 percent.

Declining issues outnumbered advancers on the NYSE by 1,462 to 1,364. On the Nasdaq, 1,721 issues fell and 1,046 advanced.

(Reporting by Ankur Banerjee and Tanya Agrawal in Bengaluru; Editing by Arun Koyyur and Nick Zieminski)