The S&P 500 posted a new all-time closing high, the Dow Jones finished at its highest level in 13 months, and the Nasdaq broke 5,000 intraday for the first time this year, in a reflection of investors’ bets that USA economy remains a pocket of solidity. The Dow Jones added 0.4% to 18,227, while the NASDAQ rallied 0.6% to 4989.
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Even as the latest bout of global anxiety eased, the CBOE Volatility Index edged higher by 2.8 percent, to 13.57.
REVERSAL OF FORTUNE: Technology and banks rose sharply today, while stocks of utilities that investors have favored recently for their steady dividends fell. The equity benchmark just posted a second week of gains following the Brexit selloff of June 24 and 27, ending Friday within a point of a record after recovering from two separate 10 percent corrections in 10 months.
Monday, the Dow Jones Industrial Average climbed 80 points to close at 18226.93 and the Nasdaq rose more than 30 points to finish at 4988.64.
Declining earnings, stagnant overseas economic growth, a plunge in oil prices, negative interest rates in some countries, the threat of interest rate increases from the U.S. Federal Reserve and a recent spate of panic selling following Britain’s vote to withdraw from the European Union have all undermined the bull market in the past year. As impressive as a new record on the S&P 500 might sound, the benchmark index is still up only 4.5% for the year-to-date. In general when the market can make new highs and.
Earnings of S&P 500 components are expected to fall 4.8 percent, compared with the year-earlier quarter, according to Thomson Reuters data.
The gains on Wall Street reflected continued momentum from Friday’s surprisingly strong U.S. jobs report, which raised hopes that the American economy was strengthening.
The next test of market strength will come over the next few weeks as US companies report their second quarter revenue and profits.
David Kostin, chief US strategist at Goldman Sachs, predicted an underwhelming earnings season on the back of disappointing profits, subdued revenue growth, negative outlook and margin pressure in the technology sector. Elsewhere in Asia, South Korea’s Kospi gained 1.3% and Hong Kong’s Hang Seng rose 1.5%.
Other stocks on the rise were airlines United Continental and American Airlines, up a respective 2.2 percent and 3.7 percent, and travel companies Priceline and Expedia, which rose 1.6 percent and 1.7 percent.
Benchmark Brent crude LCOc1 and US crude CLc1 prices hit two-month lows of $45.90 a barrel and $44.53 a barrel, respectively, on extended selling after the market’s break below a key technical support level last week due to oversupply fears.
The yield on the 10-year Treasury note rose to 1.42 percent. Brent crude, a standard for global oil prices, lost 16 cents to $46.59 a barrel in London. The euro slipped to $1.1047 from $1.1049. The dollar was last up 1.9 per cent against the safe-haven yen at 102.41 yen.
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The UK Conservative Party’s decision to fast-track Mrs May’s replacement of David Cameron as prime minister sent the FTSE100 up 1.4%, while the pound rose a full cent to $US1.30 soon after Andrea Leadsom dropped her leadership bid.
