MARKET SNAPSHOT: Dow Industrials Log A Record, Set Sights On 26,000 As Banks, Health-care Rally
Boeing adds more than nearly 60 points to Dow industrials
U.S. stock benchmarks on Tuesday afternoon finished at fresh records, with the S&P 500 and Nasdaq registering a sixth straight gain for 2018.
What did stock benchmarks do?
The Dow Jones Industrial Average tacked on 102.80 points, or 0.4%, to 25,385.80, powered by sharp gains for Boeing Co.(BA)amid reports that the plane manufacturer had a backlog of deliveries in 2017 (https://www.cnbc.com/2018/01/09/boeing-caps-2017-with-record-deliveries-backlog.html), and Johnson & Johnson(JNJ). Boeing shares added 57 points to the price-weighted Dow on Tuesday, with J&J's stock adding another 15 points.
Meanwhile, the S&P 500 index gained 3.58 points, or 0.1%, to 2,751.29, led by gains in health-care (XLV) and financial stocks (XLF). The record of six straight gains for the broad-market index tied the longest streak since 1964, according to WSJ Market Data Group.
The Nasdaq Composite Index advanced 6.19 points, or less than 0.1%, at 7,163.58. Its sixth straight gain was its longest since periods in 1992 and 1999.
The Dow Jones Transportation Average also logged a record.
The three main equity benchmarks have gained between 21% and 30% over the past 12 months, supported by factors such an expanding global economy, growth in corporate profits and enthusiasm over the Trump administration's tax cuts.
What drove the markets?
The upbeat sentiment that has kept the 2017 global stock rally running into the new year still has a grip on the market.
Check out:MarketWatch's Economic Calendar (http://www.marketwatch.com/economy-politics/calendars/economic)
On the Federal Reserve front, Minneapolis Fed President Neel Kashkari, speaking at the suburban Minneapolis headquarters of conglomerate Cargill Inc., said the U.S. must wrestle with a fiscal deficit over the long term tied to the tax-cut legislation. He also said he wouldn't be surprised to see a burst higher for productivity, which has been elusive even as the job market remains healthy.
What are the data saying?
A December figure for small-business confidence showed a dip to wrap up the strongest year on record (http://www.marketwatch.com/story/small-business-sentiment-dips-at-end-of-strongest-year-on-record-nfib-2018-01-09). Separately, a reading of job openings for November dropped to a six-month low to 5.88 million, compared with 5.93 million in the previous month.
What are strategists saying?
"This reminds me of January 2000," said Kent Engelke, chief economic strategist, at Capitol Securities Management, which manages $4 billion in assets, referring to the nearly unceasing climb to records for stocks and the unease it can inspire.
"It's scary, the unrelenting advance," he added "I think that growth will be greater than anticipated and that will cause a change in the monetary [policy] timetable, which will have a negative impact on the [stock] averages]," Engelke said.
Not everyone is happy about the relentless rally, which has been marked by few sharp downturns and a uncanny lack of volatility, as measured by the Cboe Volatility Index.
"As weird as it sounds, people that work in trading almost want to see a market crash or a surge in volatility just to get more trading going on," said Mike Antonelli, equity sales trader at Robert W. Baird & Co.
Which stocks look like key movers?
Shares in Target Corp.(TGT) jumped 2.9% after the retailer raised its fiscal fourth-quarter profit outlook, citing stronger-than-expected holiday sales (http://www.marketwatch.com/story/targets-stock-jumps-after-profit-sales-outlook-raised-in-wake-of-strong-holiday-sales-2018-01-09).
Eastman Kodak Co. (KODK) shares of the company soared by about 120% after the company said it was teaming up with a company to create a blockchain and cryptocurrency (http://www.marketwatch.com/story/kodak-boards-the-blockchain-bandwagon-2018-01-09) to pay photographers.
Alibaba Group Holding Ltd.'s stock (BABA) rose by 0.3% after the Chinese e-commerce giant's founder, Jack Ma, promised to consider listing in Hong Kong (http://www.marketwatch.com/story/alibaba-will-consider-listing-in-hong-kong-says-jack-ma-2018-01-09).
Shares in Intel Corp.(INTC) shed 2.5% as CEO Brian Krzanich delivered a speech at CES late Monday. He detailed advances in virtual reality and other technologies, while also addressing the dark cloud hanging over chip makers (http://www.marketwatch.com/story/intel-ceo-notes-dark-cloud-of-concern-at-ces-moves-onto-a-vision-for-the-future-2018-01-09).
What are other assets doing?
European stocks (http://www.marketwatch.com/story/european-stocks-rise-for-5th-session-in-a-row-stay-at-highest-since-2015-2018-01-09) gained ground along with their international counterparts, as most Asian markets closed higher (http://www.marketwatch.com/story/asian-markets-continue-their-early-year-rally-2018-01-08). Oil futures (http://www.marketwatch.com/story/oil-prices-extend-recent-gains-hint-at-fresh-3-year-highs-2018-01-09) settled near $63 a barrel, deepening its recent advance to a peak not seen since December 2014, but gold futures finished lower (http://www.marketwatch.com/story/gold-on-pace-to-notch-2-day-skid-but-holds-on-to-1300-2018-01-09) for a second session in a row as the ICE U.S. Dollar Index was modestly higher.
Meanwhile, 10-year Treasury note yield climbed to 2.55%, approaching their highest level since last March (http://www.marketwatch.com/story/treasury-yields-rise-as-bank-of-japan-cuts-bond-buying-2018-01-09), and signaling that investors in bonds are positioning for a higher rate environment, which can weigh on existing bonds and curb equity enthusiasm.
(END) Dow Jones Newswires
January 09, 2018 16:44 ET (21:44 GMT)