U.S. stocks rose again Thursday as investors were pleased with a report that showed spending by U.S. consumers grew in July, along with wages and salaries. Healthcare and technology companies led the way, and the Nasdaq composite set a record.
The Commerce Department said consumer spending grew at its fastest pace in three months. Companies that sell everything from cosmetics to toys to shoes advanced as investors bet Americans would shop more. Biotech drug companies, drug distributors and scientific equipment companies made some of the biggest gains in healthcare. Technology companies advanced for the fourth day in a row and closed at record highs. Gasoline futures continued to soar as former Hurricane Harvey left large parts of oil drilling and refining and pipelines out of commission.
The Commerce Department said consumer spending rose 0.3% in July, the best showing in three months, as wages and salaries increased. Stocks climbed a day earlier after the government raised its estimate of second-quarter economic growth. On Friday, investors will look at the government’s monthly jobs report for data on employment and wages.
“The economy is gaining traction, and inflation at this stage is still modest,” said Quincy Krosby, chief market strategist at Prudential Financial. That has been good for stocks, as low inflation and low interest rates make stocks more appealing and securities like bonds less so.
Krosby added that other news, including a manufacturing survey from China, “helped underpin the notion that it is a global recovery in the economy.”
The Standard & Poor’s 500 index rose 14.06 points, or 0.6%, to 2,471.65, its highest close in three weeks. That enabled the index to finish August with a tiny gain. The Dow Jones industrial average rose 55.67 points, or 0.3%, to 21,948.10. The Nasdaq composite climbed 60.35 points, or 1%, to 6,428.66, above the record high it set in late July. The Russell 2000 index of smaller-company stocks climbed 13.95 points, or 1%, to 1,405.28.
Drugmaker Biogen rose 4.2% to $316.58, a two-year high. Gilead Sciences climbed 3.1%, to $83.74, its highest price in more than a year.
Tech companies, which are trading at record highs, rose for the fourth day in a row. Alphabet, Google’s parent company, rose 1.2% to $955.24. Microsoft ticked up 1% to $74.77.
Among retailers, Amazon rose 1.3% to $980.60. Jewelry seller Tiffany jumped 4.3% to $91.40. Toolmaker Stanley Black & Decker climbed 3% to $144.
After three days of declines linked to Gulf Coast storm Harvey, benchmark U.S. crude jumped $1.27, or 2.8%, to $47.23 a barrel in New York. Brent crude, used to price international oils, rose $1.52, or 3%, to $52.38 a barrel in London.
Already at two-year highs, wholesale gasoline prices climbed at an even faster pace as some refining operations and pipelines in the Gulf Coast region remained offline. The price of wholesale gasoline surged 26 cents, or 13.5%, to $2.14 a gallon.
Heating oil rose 8 cents, or 5%, to $1.67 a gallon. Natural gas rose 10 cents, or 3.4%, to $3.04 per 1,000 cubic feet.
Campbell Soup skidded 8.1% to $46.20, a two-year low, after the company said it expects sales to keep falling in the next year as consumers prefer fresh foods over its canned soups and bottled juices. The company reported a weak fourth quarter that included disappointing sales of snack food, and it forecast a smaller-than-expected annual profit. Its competitor Mondelez dropped 2.3% to $40.66. Kraft Heinz fell 1.4% to $80.75. All three companies’ stocks have tumbled this year.
Discount retailer Dollar General reported a bigger profit and better sales than Wall Street expected, but it said discounts hurt its profit margins. Its stock, which had rallied since early July, fell 5.4% to $72.56.
The scope of Wells Fargo’s fake accounts scandal widened after the bank revealed that 3.5 million accounts may have been opened without customers’ permission between 2009 and 2016. That’s well above the 2.1 million such accounts the bank disclosed a year ago, when the bank said employees may have opened the accounts because of pressure to meet aggressive sales targets. Wells Fargo stock declined 29 cents to $51.07.
Bond prices moved higher. The yield on the 10-year Treasury note fell to 2.12% from 2.13%.
Gold rose $8.10 to $1,322.20 an ounce. Silver rose 7 cents to $17.58 an ounce. Copper rose 1 cent to $3.10 a pound.
The dollar fell to 109.98 yen from 110.36 yen. The euro rose to $1.1903 from $1.1890.
Germany’s DAX rose 0.4%, the French CAC 40 gained 0.6% and the British FTSE 100 advanced 0.9%. In Tokyo, the Nikkei 225 gained 0.7%. Hong Kong’s Hang Seng and Seoul’s Kospi both lost 0.4%.
2:40 p.m.: This article was updated with closing prices, context and analyst comment.
This article was originally published at 9:45 a.m.