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S&P nears record as bank, tech stocks climb

The S&P 500 index hovered near record levels on Tuesday, lifted by gains in bank and technology shares, with a strong second-quarter earnings season fueling optimism about the strength in the U.S. economy.


Reuters 07 Aug 2018, 05:18 PM

The S&P 500 index hovered near record levels on Tuesday, lifted by gains in bank and technology shares, with a strong second-quarter earnings season fueling optimism about the strength in the U.S. economy.

The index was up 0.43 percent at 2,862.69, about half a percent shy of the record it hit on Jan. 26. The Dow Jones Industrial Average, which rose 0.68 percent, is still 3.6 percent below its life high.

A sharp rally in tech stocks has already helped Nasdaq recover much faster than the broader markets, hitting a record high late last month. The index was up 0.39 percent at 7,890.03.

The financial sector rose 0.91 percent and boosted the benchmark index as higher yields on the 10-year U.S. Treasury note buoyed bank stocks.

JPMorgan rose 0.4 percent and Bank of America 0.2 percent.

On the technology front, Google-parent Alphabet rose 2.1 percent and Microsoft 0.7 percent, driving a 0.44 percent gain in the sector.

A strong earnings season has helped U.S. stocks cushion some of the impact from the ongoing trade issues.

Of the 428 S&P 500 companies that have reported earnings so far, 79 percent have topped estimates. If the beat rate holds, it will be the highest on record, dating back to the first quarter of 1994, according to Thomson Reuters I/B/E/S.

The CBOE Volatility Index, Wall Street's fear gauge, dropped to 10.52 points, its lowest since the selloff.

"Rising economic growth equals a rising stock market. Tariffs aren't a big enough opposing force to actually kill economic growth in the U.S.," said Brent Schutte, chief investment strategist at Northwestern Mutual Wealth Management Company in Milwaukee, Wisconsin.

Seven of the 11 major S&P sectors were higher, with the energy sector leading the gains. The defensive consumer staples, utilities and real estate sectors fell.

Tesla's shares jumped 5.4 percent after Elon Musk in a tweet said that he is considering taking the company private.

Broadridge Financial rose 10.8 percent and Mosaic 6.9 percent after reporting quarterly results, making them the biggest gainers on the S&P.

Walt Disney rose 1 percent ahead of its results after markets close.

Advancing issues outnumbered decliners by a 1.55-to-1 ratio on the NYSE and by a 1.48-to-1 ratio on the Nasdaq.

The S&P index recorded 28 new 52-week highs and two new lows, while the Nasdaq recorded 92 new highs and 53 new lows. 

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)


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