By April Joyner
NEW YORK (Reuters) - Wall Street's major indexes notched record highs to open the new year on Thursday, as fresh economic stimulus from China added to optimism fueled by easing trade tensions and an improving global outlook.
China's central bank said on Wednesday it would cut the amount of cash that all banks must hold as reserves, the eighth such cut since early 2018. The move to inject fresh stimulus into the Chinese economy boosted equity markets around the globe.
The benchmark S&P 500 hit its 11th record high in 14 sessions and posted its largest daily percentage gain in three weeks. The Dow registered its biggest such gain in almost four weeks, and the Nasdaq its greatest in nearly three months.
Economic stimulus in China, along with the easing of trade tensions between Washington and Beijing, has bolstered optimism that the global economy will accelerate in 2020.
"The market's been up all day because of the news that China is out there with monetary easing," said Tim Ghriskey, chief investment strategist at Inverness Counsel in New York. "With the trade deal as a backdrop, it's a positive factor."
Among the S&P 500's sectors, technology (SPLRCT) and industrials (SPLRCI), both of which have high exposure to the Chinese economy, rose more than 1% and led in percentage gains. Shares of Apple Inc (O:AAPL), which have been a bellwether of trade sentiment, ended 2.3% higher and surpassed $300.
The lengthy rally on Wall Street has prompted some concerns that U.S. stocks are vulnerable to a pullback, especially if economic growth does not pick up as much as expected or if U.S.-China trade tensions reignite.
"Large-cap equities are priced for perfection," said Peter Cecchini, global chief market strategist at Cantor Fitzgerald in New York. "It feels like we're wildly overbought given the risks that we see."
The Dow Jones Industrial Average (DJI) rose 330.36 points, or 1.16%, to 28,868.8, the S&P 500 (SPX) gained 27.07 points, or 0.84%, to 3,257.85 and the Nasdaq Composite (IXIC) added 119.59 points, or 1.33%, to 9,092.19.
Adding to positive economic sentiment, data from the U.S. Labor Department showed the number of Americans filing claims for jobless benefits edged lower last week.
Other data from Greater China showing that gross gaming revenue in Macau fell less than expected in December boosted shares of U.S. casino operators. Shares of Wynn Resorts Ltd (O:WYNN), Las Vegas Sands Corp (N:LVS) and Melco Resorts & Entertainment Ltd (O:MLCO) rose between 2% and 4%.
Advancing issues outnumbered declining ones on the NYSE by a 1.74-to-1 ratio; on Nasdaq, a 1.41-to-1 ratio favored advancers.
The S&P 500 posted 59 new 52-week highs and one new low; the Nasdaq Composite recorded 115 new highs and 15 new lows.
Volume on U.S. exchanges was 7.61 billion shares, compared to the 6.85 billion-share average for the full session over the last 20 trading days.