Stocks rise, lifting the S&P 500 and Nasdaq to record highs
U.S. stocks posted solid gains Tuesday, propelling the Standard & Poor’s 500 index and Nasdaq composite to all-time highs.
Mining and other materials-sector companies rose more than the rest of the market. The sector could benefit from initiatives by the White House to streamline the permitting process for manufacturing and clear the way for pipeline construction.
Financial stocks also rose sharply. Energy companies climbed as crude oil prices advanced. The rally also swept up stocks in U.S. home builders.
Healthcare, phone companies and other high-dividend stocks were among the biggest laggards as bond yields rose.
Although several big companies reported quarterly earnings, investors focused on the latest batch of executive actions from President Trump.
“The importance of this earnings season has been dimmed only because we all realize there’s going to be some changes in policy,” said J.J. Kinahan, TD Ameritrade’s chief strategist. “Now you’re trading on the edicts, or whatever they may be, that are coming out of the White House.”
The Dow Jones industrial average rose 112.86 points, or 0.6%, to 19,912.71. The S&P 500 index climbed 14.87 points, or 0.7%, to 2,280.07. The tech-heavy Nasdaq composite went up 48.01 points, or 0.9%, to 5,600.96.
Small-company stocks outpaced the rest of the market. The Russell 2000 jumped 21.37 points, or 1.6%, to 1,369.21.
Investors bid up shares in several companies that reported better-than-expected earnings. Kimberly-Clark, which makes Kleenex and other paper products, rose 4.1% to $121.79. Home builder D.R. Horton jumped 6.6% to $30.64. DuPont climbed 4.5% to $76.05.
But the action in Washington also held the market’s interest.
Trump hosted a breakfast meeting with the heads of General Motors, Ford Motor and Fiat Chrysler Automobiles. Before the meeting, Trump tweeted that he wants “new plants to be built here for cars sold here.” He has warned of a “substantial border tax” on companies that move manufacturing out of the country and has promised tax advantages to those that produce domestically.
“They used to call some of this jawboning,” said David Winters, chief executive of Wintergreen Advisers. “So, far President Trump has been encouraging companies to do what’s in his vision of a successful America. There’s a lot of enthusiasm, but it’s really going to be what happens in the next couple of months in terms of legislation so there’s clarity.”
Automakers expressed optimism after the meeting. And shares in their companies rose. GM shares went up 1% to $37, Ford advanced 2.4% to $12.61 and Fiat Chrysler climbed 5.8% to $10.88.
Trump also signed executive actions to advance construction of the Keystone XL and Dakota Access oil pipelines. President Obama killed the proposed Keystone XL pipeline in late 2015, which would run from Canada to U.S. refineries in the Gulf Coast, saying it would hurt American efforts to reach a global climate change deal.
The Army decided last year to explore alternate routes for the Dakota pipeline after the Standing Rock Sioux tribe and its supporters said the pipeline threatened drinking water and Native American cultural sites.
Shares of mining company Freeport-McMoRan vaulted 8.3% to $17.02, the biggest gainer in the S&P 500 index.
Some companies’ financial results put traders in a selling mood.
Verizon slumped 4.4% to $50.12 — the biggest decliner in the S&P 500 — after the phone and communications company served up earnings for the last three months of 2016 that fell short of what analysts expected. The company, whose deal to buy Yahoo’s Internet operations may be in jeopardy, also said its roster of retail postpaid subscribers fell sharply.
Major market indexes overseas were mixed.
Germany’s DAX rose 0.4%, while France’s CAC 40 added 0.2%. Britain’s FTSE 100 was flat after the Supreme Court there said Parliament would have a right to vote on whether Britain formally exits the European Union. The ruling doesn’t mean that Britain will remain in the EU, but it could delay the process of leaving.
Japan’s benchmark Nikkei 225 slid 0.6%, while Australia’s S&P/ASX 200 added 0.7%. South Korea’s Kospi slipped 0.01%. Hong Kong’s Hang Seng gained 0.2%.
Benchmark U.S. crude rose 43 cents, or 0.8%, to $53.18 a barrel. Brent crude, used to price international oils, rose 21 cents, or 0.4%, to $55.44 a barrel.
In other energy trading, wholesale gasoline rose a penny to $1.58 a gallon, while heating oil added 2 cents to $1.64 a gallon. Natural gas futures rose 4 cents, or 1.1%, to $3.28 per 1,000 cubic feet.
Bond prices fell. The 10-year Treasury yield rose to 2.46% from Monday’s 2.40%.
The dollar rose to 113.89 yen from 113 yen. The euro fell to $1.0723 from $1.0746.
The price of gold slid $4.80 to $1,210.80 an ounce. Silver was little changed at $17.19 an ounce. Copper rose 6 cents to $2.71 a pound.
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UPDATES:
3:05 p.m.: This article was updated with additional closing prices, context and analyst comment.
1:45 p.m.: This article was updated with closing prices.
7:35 a.m.: This article was updated with market prices and context.
This article was originally published at 7 a.m.
