U.S. Stocks Keep Climbing

By Mike Bird Features Dow Jones Newswires

U.S. stocks rose Tuesday, continuing their climb a day after the S&P 500 posted a fresh record high.

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The Dow Jones Industrial Average gained 26 points, or 0.1%, to 21008 shortly after the opening bell. The S&P 500 added less than 0.1%, and the Nasdaq Composite rose 0.1%.

Major stock indexes have largely climbed in recent weeks as corporate earnings have pointed to strength among firms in both the U.S. and elsewhere. Investors' expectations for global profits are at a three-year high, Bank of America Merrill Lynch said Tuesday, with more than half of fund managers expecting profits to improve over the next 12 months.

Still, some analysts say political uncertainty in the U.S. could weigh on stocks, especially if they appear to reduce the chances of a tax cuts package. Bets on lower tax rates under the Trump administration had helped stocks rally after Election Day.

"In terms of potential implications for the markets, finding support in Congress for fiscal measures may prove even more difficult for President Trump if the latest reports undermine his relationship with the Republicans," said Piotr Matys, foreign-exchange strategist at Rabobank, referring to reports that President Donald Trump shared sensitive intelligence obtained from a close U.S. ally with Russia's foreign minister and ambassador.

Government bonds ticked lower, with the yield on the 10-year U.S. Treasury note rising to 2.342% from 2.338% Monday. Yields rise as bond prices fall.

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Oil prices climbed, with U.S. crude rising 0.7% to $49.20 a barrel, on track for its fifth consecutive session of gains. Crude for June delivery settled Monday at its highest level since Apri l after Russian and Saudi Arabian energy ministers said they agreed to back a nine-month extension of production cuts aimed at bringing down global inventories.

Despite indications the production cap will be extended -- and expectations of increased second-half demand -- investors should remain cautious, said Stuart Ive, private client manager at OM Financial in New Zealand.

"OPEC meets on the May 25, so the market will want official confirmation of the deal rollover," Mr. Ive said.

Elsewhere, European stocks wavered, with the Stoxx Europe 600 up less than 0.1%.

Japan's Nikkei Stock Average edged up 0.3% and the Shanghai Composite rose 0.7%, posting its fourth consecutive session of gains.

Akane Otani contributed to this article

Write to Mike Bird at Mike.Bird@wsj.com

(END) Dow Jones Newswires

May 16, 2017 09:56 ET (13:56 GMT)