MARKET SNAPSHOT: Dow Powers Through 25,000; Major Indexes At Records
Tesla falls after fourth-quarter vehicle deliveries
U.S. stocks rose on Thursday, with the Dow topping the 25,000 milestone for the first time as major indexes notched another round of records that put them on track for their third straight daily increase.
What are stock indexes doing?
The Dow Jones Industrial Average rose 150 points, or 0.6%, to 25,071. While 25,000 is seen as a psychologically significant level, it otherwise holds no fundamental or technical importance.
The S&P 500 rose 12 points, or 0.4%, to 2,725. The Nasdaq Composite Index gained 13 points, or 0.2%, to 7,078.
Read:Dow 25K! Here's what it says about the stock market (http://www.marketwatch.com/story/dow-25k-heres-what-it-says-about-the-stock-market-2018-01-04)
Don't miss:Why only a tiny percentage of Americans benefit from Dow 25,000 (http://www.marketwatch.com/story/why-only-a-tiny-percentage-of-americans-benefit-from-dow-25000-2018-01-04)
All three hit intraday records in early trading and are poised for their third straight daily increase. If the S&P ends in positive territory, it would close at a record in each of the first three trading days of the new year, the first time it has done so since 1964, according to The Wall Street Journal Market Data Group. The Nasdaq is poised to do the same, for the first time since 1999.
Nine of the 11 primary S&P 500 sectors rose on the day, though most of the moves were modest. Particular strength came in the financial sector, up 1.4%. Defensive groups--telecom and real estate--were the laggards of the day. A number of major companies hit record levels, including Facebook(FB), Amazon (AMZN), and Netflix (NFLX) though since then prices retreated slightly.
What's driving the market?
U.S. stock markets have risen on every single day of the new year so far, as the global trading mood from 2017 stayed strongly positive. Analysts said the upbeat sentiment is buoyed by a protracted rise in commodity prices, solid economic data, and bond yields remaining at historic lows. The recently passed tax-reform legislation has also been cited as a contributing factor.
In Asia on Thursday, Japan's Nikkei 225 index ended at a 26-year high (http://www.marketwatch.com/story/nikkei-soars-on-its-first-trading-day-of-2018-leading-asian-market-gains-2018-01-03), while in Europe, stocks rose (http://www.marketwatch.com/story/european-stocks-set-for-2-week-high-boosted-by-car-makers-and-oil-majors-2018-01-04) almost across the board.
Energy companies contributed to the global gains, tracking a rise in oil prices. Crude futures were trading around three-year highs as antigovernment protests continued in Iran. The riots, which have left more than 20 people dead, have prompted fears of a disruption to crude output from OPEC's third-largest producer, which would limit global oil supply and support prices.
What are strategists saying?
"Momentum was the single-biggest factor driving prices in 2017, and that remains the case so far this year. Valuations are stretched, no question, based on historical standards, but they're OK relative to bond yields and inflation, which means we're not overly concerned about them at this juncture," said Michael Mullaney, director of global market research at Boston Partners.
Read:Fed minutes show a divide over its own forecast of 3 rate hikes this year (http://www.marketwatch.com/story/fed-minutes-show-divide-over-its-own-forecast-of-three-rate-hikes-this-year-2018-01-03)
What's the latest economic data?
Private-sector hiring was stronger than expected in December (http://www.marketwatch.com/story/private-sector-job-growth-sizzles-in-december-with-250000-jobs-added-adp-says-2018-01-04), according to payroll processor ADP. Employers added 250,000 jobs, more than the 188,000 jobs forecast by economists surveyed by Econoday. November's tally was reduced by 5,000, however.
Separately, weekly jobless claims rose by 3,000 to 250,000 in the latest week.
Both reports are seen as a precursor to the closely watched nonfarm payrolls report on Friday, although the two data sets sometimes vary widely.
"If you breach 300,000 on claims, then you're skating on thin ice. We're nowhere near that," said Mullaney. Data like this "continues to demonstrate the positive global macroeconomic backdrop that means economies around the world, including the U.S., should be OK for the foreseeable future. Strong labor market data will help earnings, which in turn will help stock prices."
The latest purchasing manager's index on the services sector came in at 53.7, compared with the prior reading of 54.5.
Which stocks are in focus?
Financial stocks rose broadly. JPMorgan Chase & Co. (JPM) added 1.6% while Bank of America Corp. (BAC) was up 1.6%. Wells Fargo & Co. (WFC) jumped 1.6%.
Shares of Tesla Inc. (TSLA) fell 1%, well off its lows of the session. The electric-car maker said late Wednesday it had delivered fewer-than-expected vehicles in the fourth quarter (http://www.marketwatch.com/story/tesla-pushes-back-model-3-production-target-as-fourth-quarter-deliveries-fall-short-2018-01-03) as it pushed back a Model 3 production target.
Macy's Inc.(M)reported an increase in its holiday same-store sales (http://www.marketwatch.com/story/macys-reports-holiday-season-same-store-sales-increase-11-store-closures-in-early-2018-2018-01-04). The department store also said it would close stores in early 2018. The stock fell 2.8%, but it has been a strong performer of late, up 18% over the past three months.
Monsanto Co. (MON) reported first-quarter earnings and revenue that came in below expectations (http://www.marketwatch.com/story/monsanto-reports-improved-q1-earnings-driven-by-bayer-merger-soybean-sales-2018-01-04). Shares rose 0.4%.
Intel Corp.(INTC) tumbled 2.5%, adding to a 3.4% loss logged on Wednesday. The prior session's decline came after the technology company admitted its chips have a security vulnerability (http://www.marketwatch.com/story/intel-stock-headed-for-worst-day-in-more-than-a-year-amd-pops-on-chip-design-flaw-report-2018-01-03) that will require software patches. Intel Chief Executive Brian Krzanich sold millions of dollars worth of shares (http://www.marketwatch.com/story/intel-ceo-sold-millions-in-stock-after-company-was-informed-of-vulnerability-before-disclosure-2018-01-03) after the company was informed of the vulnerabilities in its semiconductors but before it was publicly disclosed.
Celsion Corp.(CLSN) jumped 4.6% after the Food and Drug Administration cleared its ovarian cancer therapy (http://www.marketwatch.com/story/celsion-shares-rise-20-after-fda-clears-its-ovarian-cancer-therapy-for-a-phase-12-trial-2018-01-04-8913741) for a phase 1/2 clinical trial.
See: What you need to know about the huge flaws affecting Intel and others (http://www.marketwatch.com/story/meltdown-and-spectre-are-huge-vulnerabilities-for-intel-and-more-what-you-need-to-know-2018-01-03)
Opinion: Intel suffers an epic security fail, offering a big opportunity for AMD (http://www.marketwatch.com/story/intel-suffers-an-epic-security-fail-offering-a-big-opportunity-for-amd-2018-01-03)
(http://www.marketwatch.com/story/intel-suffers-an-epic-security-fail-offering-a-big-opportunity-for-amd-2018-01-03)Shares of Walgreens Boots Alliance Inc.(WBA) fell 4% after the drugstore chain posted better-than-expected earnings (http://www.marketwatch.com/story/walgreens-boots-alliance-shares-rise-premarket-after-earnings-top-estimates-2018-01-04).
CVS Health Corp.(CVS) added 2.7% after the company issued its guidance for 2018 (http://www.marketwatch.com/story/cvs-sees-2018-revenue-growth-of-075-to-25-2018-01-04-7912229), saying it expects revenue growth of 0.75% to 2.5%.
L Brands Inc.(LB) slid 13% after the retailer said same-store sales fell 4% in the 48 weeks ended Dec. 30.
What are other markets doing?
Bitcoin futures dropped 0.6% to $14,880, while rival cryptocurrency ripple coin jumped 39% to $3.81, according to CoinMarketcap.com (https://coinmarketcap.com/currencies/ripple/).
Gold prices rose 0.1% (http://www.marketwatch.com/story/gold-slips-pauses-longest-winning-streak-since-2014-2018-01-04) to reach $1,320 an ounce. Oil futures (http://www.marketwatch.com/story/crude-oil-jumps-to-3-year-high-as-iran-tensions-spark-supply-fears-2018-01-04) rose 0.7%, to $61.98 a barrel, with prices on track for the highest futures settlement since December 2014.
The dollar declined (http://www.marketwatch.com/story/dollar-resumes-slide-as-euro-nears-3-year-high-2018-01-04) against most other major currencies, sending the ICE dollar index down 0.3% to 91.93.
(END) Dow Jones Newswires
January 04, 2018 13:56 ET (18:56 GMT)