U.S. stocks closed at a record high Monday, propelled by gains for chemical and machinery companies. Energy companies rose as the price of oil continued its recent recovery.
Chemical makers and mining companies made the biggest gains, and machinery companies and banks followed. Investors sold government bonds and utility and phone companies, all of which climbed earlier in the year as investors sought safety. Stocks have seesawed between small gains and losses for more than a week as investors consider mixed reports on the health of the economy and a decline in corporate earnings. That hasn't stopped them from setting records, but it has kept investors wary.
"The market has run up in anticipation of better earnings ahead," said Brian Nick, chief investment strategist for TIAA Investments. "If those earnings don't come, we have the Wile E. Coyote moment where we're off the cliff and we're gonna fall."
The Dow Jones industrial average climbed 59.58 points, or 0.3%, to 18,636.05. The Standard & Poor's 500 index rose 6.10 points, or 0.3%, to 2,190.15. The Nasdaq composite advanced 29.12 points, or 0.6%, to 5,262.02.
Second-quarter earnings are nearly all in the books, with this week's releases from retailers Home Depot, Wal-Mart and Target among the last to appear. Corporate earnings are down once again this quarter. Investors don't expect much growth in the third quarter either, but they are starting to expect improvement after that.
U.S. crude jumped $1.25, or 2.8%, to $45.74 a barrel in New York. Brent crude, a benchmark used to price international oils, rose $1.38, or 2.9%, to $48.35 a barrel in London. After a steep slide for most of June and July, the price of U.S. crude climbed 6.4% last week.
Drilling rig operator Transocean advanced 5.4% to $10.43. National Oilwell Varco picked up 3.1% to $34.85 and ConocoPhillips rose 2% to $42.18.
Chemicals company LyondellBasell Industries rose 2.9% to $77.49, mining and energy company Freeport-McMoRan climbed 3% to $12.17 and aluminum producer Alcoa went up 3.4% to $10.52.
Utility companies took the largest losses. Southern Co. declined 1.6% to $51.49 and Consolidated Edison sank 2.4% to $76.24. Phone companies and household goods makers also slipped.
Real estate investment trust Mid-America Apartment Communities will buy competitor Post Properties for about $3.9 billion in stock. Both companies own large numbers of rental properties, many of them in the Sun Belt. Demand for rentals has boomed in recent years because many people are being priced out of the housing market.
The deal values Post Properties at about $72.53 a share based on Friday's closing prices. Post Properties' stock leaped 9.4% to $68.08 and Mid-America shares sank 4.9% to $97.15.
Water treatment company Xylem announced a $1.7-billion deal to acquire Sensus, a company that provides smart meters, network technology and analytics used by water, electric and gas utilities. Xylem shares rose 3.9% to $50.32.
A survey showed that U.S. homebuilders are feeling more optimistic about the market as prices and sales of new homes rise. The National Assn. of Home Builders/Wells Fargo builder sentiment index rose from last month. New home sales grew in June at the fastest pace in eight years, aided by continuing job growth and low mortgage rates. Toll Brothers climbed 3.2% to $28.86 and Lennar advanced 1.2% to $47.30.
Wholesale gasoline rose 3 cents to $1.40 a gallon. Heating oil rose 4 cents to $1.45 a gallon. Natural gas held steady at $2.59 per 1,000 cubic feet.
Gold rose $4.30 to $1,347.50 an ounce. Silver advanced 14 cents to $19.85 an ounce. Copper picked up 1 cent to $2.15 a pound.
The dollar fell to 101.25 yen from 101.27 yen and the euro rose to $1.1183 from $1.1164.
Japan's economy grew at a lower-than-forecast 0.2% pace in the April-through-June quarter as private demand and exports remained weak. That could push the Bank of Japan to take additional steps to stimulate the national economy. The bank approved a new stimulus package earlier this month, but that wasn't enough to please investors.
Germany's DAX was up 0.2% and France's CAC 40 slipped less than 0.1%. Britain's FTSE 100 gained 0.4%. Japan's Nikkei 225 edged 0.3% and Hong Kong's Hang Seng index rose 0.7%.
2 p.m.: This article was updated with closing prices and additional details.
7:55 a.m.: This article was updated with more recent prices and additional details.