Source: Market Watch Personal Finance
The benchmark S&P 500 index climbed to an intraday record Monday as investors flocked to U.S. equities following a surprisingly strong jobs report last Friday.
The S&P 500
SPX, +0.57%
most recently was trading 10 points, or 0.5%, higher at 2,139.70, surpassing the previous intraday record of 2,134.72 set on May 21, 2015 when the large-cap benchmark scored a record close at 2,130.82. The index traded as high as 2,140.51in early Monday trade. Gains were led by technology, energy and industrials stocks, while defensive sectors such as utilities, telecoms and consumer-staples were trading lower.
“It is amazing to see what very low interest rates globally could do for [equities]. Stocks are being driven to new highs in part because of search for yield and in part on anticipation that earnings will start improving this year,” said Eric Wiegand, senior portfolio manager at the Private Client Reserve, U.S. Bank.
Wiegand noted that given the fact that stocks are fully valued, “volatility will remain the name of the game.”
“The S&P 500 can easily fluctuate between 1,900 and 2,200 through the end of the year,” Wiegand said.
The Dow Jones Industrial Average
DJIA, +0.71%
gained 110 points, or 0.6%, to 18,257, led by a 1.6% rise in shares of Boeing Co.
BA, +1.67%
Meanwhile, the Nasdaq Composite Index
COMP, +0.86%
climbed 36 points, or 0.7%, to 4,993.
Markets on Monday also were boosted by the election in Japan over the weekend. Prime Minister Shinzo Abe’s ruling coalition, led by his Liberal Democratic Party, won more seats in the upper house to now have two-thirds majority, which is seen as making it easier for policy makers to push through a bigger fiscal stimulus package this autumn to spur the economy. Japan’s Nikkei 225 index
NIK, +3.98%
closed 4% higher.
U.S. markets rallied on Friday after the nonfarm-payrolls report showed 287,000 jobs were added to the economy in June, easily beating the 170,000 forecast. With continued uncertainty over the fallout of the U.K.’s Brexit vote and low inflation, the solid jobs number, however, isn’t seen as prompting a Federal Reserve rate hike soon, giving traders the best of both worlds at the moment.
Economic news: There were no major data on tap on Monday, but several Federal Reserve speakers make for a busy day on the economic calendar.
Kansas City Fed President Esther George in a speech in Lake Ozark, Missouri said the Federal Reserve currently is keeping U.S. interest rates too low given the progress that has been made in the U.S. economy, according to Reuters.
This evening Cleveland Fed President Loretta Mester, is scheduled to speak about financial stability in Sydney, Australia, at 9:30 p.m. Eastern.
Both are voting members this year on the policy-setting Federal Open Market Committee.
Earnings: The unofficial starting whistle for the earnings season sounds after the bell on Monday, when aluminum heavyweight Alcoa Inc.
AA, +3.36%
releases second-quarter results. Shares were up 1%.
Cintas Corp.
CTAS, -1.84%
is also slated to report after hours. Later in the week, attention turns to banking results, with J.P. Morgan Chase & Co.
JPM, +1.04%
the first of the big U.S. banks to report on Thursday.
“Investment banking earnings have been on a slow decline for the last 12 months and with trillions of US dollar of global bond yields now in negative territory this week’s earnings announcements are likely to make for sobering reading,” said Michael Hewson, chief market analyst at CMC Markets, said in a note.
Movers and shakers: Shares of Kinder Morgan Inc.
KMI, +3.91%
rose 3.2% after the energy-infrastructure company said Sunday it is selling a stake in a 7,600-mile natural-gas pipeline system to Southern Co.
SO, -0.31%
$1.47 billion.
Twitter Inc.
TWTR, -2.41%
slid 1.4% after analysts at Monness Crespi Hardt downgraded stock to neutral from buy.
Other markets: European
SXXP, +1.64%
and Asian stocks posted firm gains across the board.
Oil prices
CLQ6, -1.43%
LCOU6, -1.26%
lost more than 0.3%, while gold
GCQ6, +0.05%
was nearly unchanged. The dollar rose against most other major currencies, with the ICE dollar index
SXXP, +1.64%
up 0.3%.
Source: Market Watch Personal Finance
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