S&P; Hits 5th Record Close; Dollar Climbs
U.S. stocks rose along with bond prices Monday as the dollar climbed against the Japanese yen and investors speculated Asia’s troubles might slow the economy in the months ahead.
But stocks shrugged off news from Japan, and the S&P; 500 set another record amid mounting confidence that this month’s company profit reports won’t show that stocks are overpriced.
The price of the benchmark 30-year Treasury bond rose to push its yield to 5.57%. That matches the yield reached June 15, the lowest since the government began regular sales of the securities in 1977. On Thursday, the yield was at 5.60%.
The Dow Jones industrial average rose 66.51 points to 9,091.77, lifting this year’s gain to 15%.
It was the highest close since May 22 for the barometer of 30 big companies, which now sits 120 points below May 13’s record finish of 9,211.84.
Broader measures were also higher. The Nasdaq composite index, heavily weighted with Internet stocks, rose 15.47 points to 1,909.47, a gain of 0.8%, slightly bigger than the Dow’s.
Investors were in a bullish mood, with the June quarter earnings season kicking off this week amid expectations that most companies can meet or beat their trimmed forecasts, analysts said.
“What we are seeing today is some buildup in anticipation of some good earnings coming forward,” said Robert Froehlich, chief investment strategist at Scudder Kemper Investments.
The Standard & Poor’s 500 rose 10.91 points to 1,157.33, setting its fifth record in eight sessions and extending this year’s gain to 19.25%.
The New York Stock Exchange composite index rose 5.02 points to 590.82 for its second straight record close.
Advancing issues outnumbered decliners by a 4-3 margin on the NYSE, where composite volume totaled 514.75 million shares, up from Thursday’s pre-holiday tally of about 510 million. U.S. financial markets were closed Friday.
Smaller-company measures continued to lag the blue-chip rebound and remained well below record terrain. The Russell 2,000 index rose 1.67 points to 459.98.
Among Monday’s highlights:
* The strongest issues among the Dow 30 were McDonald’s, up $2.50 to $73.50; Merck, up $2.13 to $134.88; General Motors, up $2 to $70.88; and DuPont, up $2 to $78.19.
* Specialty retailers rallied. Best Buy gained $2.13 to $40.06, Home Depot, which split its stock 2-for-1 last week, jumped $3.25 to $46.19 and Tandy gained $1.50 to $52.94.
Proffitt’s fell $4 to $36.69 after it agreed to buy luxury retailer Saks Holdings for more than $2 billion in stock and assumed debt. Proffitt’s, the fourth-largest U.S. department-store chain, will exchange shares worth $33.36 for each Saks share. Saks rose 44 cents to $29.44.
In currency trading, the dollar rose against the Japanese yen overnight after Japan’s Prime Minister Ryutaro Hashimoto quashed talk of big tax cuts. The dollar traded at 140.15 yen late in New York, from 140.99 late Thursday.
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Market Roundup, D14
