MARKET SNAPSHOT: Dow, S&P 500, Nasdaq End At Records On The Same Day For First Time In 6 Weeks
McDonald's sees its stock suffer worst daily drop in more than a year on research report
All three major U.S. stock indexes booked all-time closing highs on Tuesday, though gains were capped by unsteady trade in technology, after a brisk, broad-market run-up in the previous session.
It marks the first time all three benchmarks finished at records on the same day since July 26, underlining a resurgence, albeit measured, in buying on Wall Street. Investors also focused on a key product debut from Apple.
Check out: A live recap of Apple's iPhone presentation (http://blogs.marketwatch.com/thetell/2017/09/12/apple-event-expected-to-include-redesigned-iphone-on-tenth-anniversary-live-blog/)
The Dow Jones Industrial Average rose 61.49 points, or 0.3%, to finish at 22,118.86, its 36th record of 2017. Gains were limited, however, by a sharp decline in shares of McDonald's Corp. (MCD), which booked its worst one-day decline since July 26, 2016, according to FactSet data. The drop was being attributed to a bearish note by research company M Science (http://www.marketwatch.com/story/mcdonalds-stock-pulls-back-from-record-after-reports-of-downbeat-sales-call-by-research-firm-2017-09-12).
The S&P 500 added 8.37 points, or 0.3%, to close at 2,496.48, notching its second record in as many days and its 32nd this year, led by a second straight day of gains for financials as the yield of the 10-year Treasury note climbed to 2.17%, compared with around 2.05% late last week. Rising yields support the business models of lenders like Goldman Sachs Group Inc. (GS) and J.P. Morgan Chase & Co. (JPM).
The Nasdaq Composite Index finished up 22.02 points, or 0.3%, at 6,454.28, overcoming early session wobbles to book its 47th all-time high for the technology-laden index this year.
Robert Pavlik, chief market strategist at Boston Private Wealth, said recent moves are a combination of the unwind of the so-called fear trade, which has helped to lift rates and the banking sector--typically a bellwether for the rest of the economy--in tandem. He said the market has broadly offered signs that it is growing at a healthy, if not at a robust pace, which should be taken as a bullish sign.
Recent data may support that notion, with data showing job openings (http://www.marketwatch.com/story/looking-for-work-us-job-openings-hit-another-record-2017-09-12-101034234)in the U.S. hitting a record in July. The Labor Department reported on Tuesday that openings edged up to 6.17 million in July from 6.12 million in June. It is the first time openings have topped 6 million for two straight months since the government began keeping track in 2000.
Moreover, incomes in the U.S. jumped last year, allowing the average American household to finally recover the ground it lost in the past two recessions, according to Census Bureau data.
"Today's movement is a [further] unwinding of the fear trade," Pavlik said. He has maintained a fairly rosy outlook for the S&P 500 with a year-end forecast at 2,535, less than 2% from present levels.
"There will be some more volatility before the month is over, but I am not letting that bother me," Pavlik said. "I am seeing a [corporate] earnings environment that is supportive at these levels, but we will likely get these periods where people are worried abut valuations," he said.
Market participants also are looking for further signs that fiscal-stimulus measures promised by President Donald Trump during his presidential campaign may still have a chance of coming to fruition on the heels of an interview with Treasury Secretary Steven Mnuchin on CNBC Tuesday morning at an investment conference in New York.
Check out: MarketWatch's coverage of Delivering Alpha (http://blogs.marketwatch.com/thetell/2017/09/12/delivering-alpha-live-blog/#wysiwygEditor)
Mnuchin said he hopes Republicans can get a tax overhaul through Congress by the end of the year, and offered that the administration was considering backdating tax reform to the start of 2017.
"Tax reform retroactive to January of 2017 is very positive if that were to happen," said Peter Cardillo, chief market economist at First Standard Financial. "That would obviously give a boost to economic activity and corporate growth ahead," he said.
Tuesday's moves come after the S&P 500 and the Dow industrials logged their biggest one-day percentage gains (http://www.marketwatch.com/story/dow-futures-up-more-than-100-points-as-fears-ease-over-hurricane-irma-north-korea-2017-09-11) in months on diminished anxieties about hurricanes, notably Hurricane Irma which hit Florida over the weekend, and tensions in the Korean Peninsula.
Read:This legendary value-investor is another stymied by expensive stocks (http://www.marketwatch.com/story/expensive-stocks-frustrate-another-value-investing-legend-report-says-2017-09-11)
Apple Inc. (AAPL) shares ended down 0.6% as news emerged that sales of the tech giant's much-anticipated iPhone X will occur in the next fiscal year. Apple executives announced Tuesday (http://www.marketwatch.com/story/apple-shares-fall-after-news-iphone-x-sales-will-occur-in-next-fiscal-year-2017-09-12) that the new iPhone X, priced at $999, will be available for preorder in October, and not delivered until Nov. 3.
Opinion:Apple's new iPhone won't move the stock the way these drivers could (http://www.marketwatch.com/story/apples-iphone8-wont-move-the-stock-the-way-these-drivers-could-2017-09-11)
(http://www.marketwatch.com/story/apples-iphone8-wont-move-the-stock-the-way-these-drivers-could-2017-09-11) (http://www.marketwatch.com/story/apples-iphone8-wont-move-the-stock-the-way-these-drivers-could-2017-09-11)And:Tired of the FANG gang? These 2 tech stocks look like they're in the same class (http://www.marketwatch.com/story/tired-of-the-fang-gang-these-2-tech-stocks-look-like-theyre-in-the-same-class-2017-09-11)
(http://www.marketwatch.com/story/expensive-stocks-frustrate-another-value-investing-legend-report-says-2017-09-11)Economic reports: On the economic front, median household income last year was $59,039, up an inflation-adjusted 3.2% from 2015, the Census Bureau said Tuesday. It was a new high for the figure, surpassing the previous peak for household income reached in 1999.
Data earlier showed sentiment among small-business owners ticked up in August (http://www.marketwatch.com/story/small-business-capital-spending-plans-jump-to-post-recession-high-2017-09-12).
Moving stocks: Shares of Teva Pharmaceuticals Industries Ltd.(TEVA) rose nearly 7% after the Israel-based pharmaceutical group said late Monday it will sell its Pargard IUD product (http://www.marketwatch.com/story/cooper-cos-buys-teva-iud-line-for-11-billion-2017-09-11) to Cooper Cos.(COO) for $1.1 billion in cash. Cooper shares ended down 1.1%.
Equifax Inc.(EFX) shares rose 2.5%. Ratings agency Standard & Poor's announced late Monday a downgrade of its outlook on the credit-reporting agency (http://www.marketwatch.com/story/equifax-outlook-lowered-to-negative-by-standard-and-poors-2017-09-11) to negative from stable in the wake of a recent breach that put the data of 143 million Americans at risk.
Read:Equifax lobbied for more lax regulations ahead of massive data breach (http://www.marketwatch.com/story/equifax-lobbied-for-more-lax-regulations-ahead-of-massive-data-breach-2017-09-11)
At a hedge-fund conference, Delivering Alpha, in New York, Julian Robertson, chief executive of Tiger Management, on said he favored the so-called FAANG stocks, arguing that Apple, Facebook Inc. (FB) and Google Inc.(GOOGL) (GOOGL) are still cheap despite recent advances.
Shares of Perrigo Co. (PRGO) surged 4.6%Tuesday after Jeff Smith (http://www.marketwatch.com/story/perrigo-surges-as-starboard-values-jeff-smith-talks-up-the-stock-2017-09-12), chief executive officer of Starboard Value, singled out the pharmaceutical company as a good investment at the same conference.
Other markets:Asian markets (http://www.marketwatch.com/story/nikkei-hits-best-intraday-level-in-a-month-as-asian-markets-extend-gains-2017-09-11) saw tepid gains, outside of a 1.2% rally for the Nikkei which hit its best intraday level in a month as the yen continued to fall against the dollar. The dollar index , meanwhile, was modestly higher, marked by that stronger dollar/yen pair.
The British pound hit the highest level this year (http://www.marketwatch.com/story/dollar-falls-against-pound-with-sterling-at-2017-high-on-rate-hike-prospects-2017-09-12) after U.K. inflation rose by more than expected.
Read: Why the Swiss central bank may be betting on a stronger euro (http://www.marketwatch.com/story/why-the-swiss-central-bank-is-betting-on-a-stronger-euro-analysts-say-2017-09-11)
The Stoxx Europe 600 index finished up 0.5%. Oil prices settled higher for a second straight session (http://www.marketwatch.com/story/oil-prices-climb-for-2nd-day-as-opec-report-shows-production-drop-2017-09-12), and gold prices closed in the red (http://www.marketwatch.com/story/gold-knocked-back-to-over-1-week-low-as-record-high-stocks-lure-investors-2017-09-12).
(END) Dow Jones Newswires
September 12, 2017 17:06 ET (21:06 GMT)