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Stocks - S&P Hits a Record Close as Tech, Trade Hopes Power Market

Published 10/28/2019, 03:51 PM
Updated 10/28/2019, 05:13 PM
© Reuters.
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Investing.com - U.S. stocks surged Monday with the S&P 500 hitting new intraday and closing highs and new records set for the Nasdaq 100 index as well.

The rally was pushed by gains in technology and communications services, which translates basically into big tech stocks, including Apple (NASDAQ:AAPL), Google parent Alphabet (NASDAQ:GOOGL), Microsoft (NASDAQ:MSFT) and Applied Materials (NASDAQ:AMAT). All of those stocks hit new highs.

Banks also saw new highs.

The S&P 500 hit an all-time high of 3,044.08 soon after the open and finished up 0.6% at a record 3,039.42, breaking the old closing high of 3,025.86, set on July 26.

The Nasdaq 100 ended up 1.01% at 8,110.67. It hit a new intraday high of 8,119.73 and broke its old closing record of 8,029.22, set just on Friday. The Nasdaq Composite was also up 1.01%.

The Dow Jones industrials were up 0.5%, thanks to gains for Microsoft, Apple and JPMorgan Chase (NYSE:JPM), but was off about 1.1% from its high.

The catalysts were expectations that the Federal Reserve will cut its key interest rate on Wednesday and bullishness about Alphabet, which reported postmarket today and Apple, which reports fiscal fourth-quarter results after Wednesday's close.

Alphabet (NASDAQ:GOOGL) shares were 0.8% lower after hours after its earnings missed analyst estimates because of heavy marketing spending, even as revenue jumped 20% to $40.5 billion.

Luxury jeweler Tiffany & Co (NYSE:TIF) shares jumped 31% after French luxury group LVMH (PA:LVMH) offered to buy the iconic New York company for $14.5 billion.

In addition, there were continued hopes that a partial U.S.-China trade deal would be negotiated soon. President Donald Trump tweeted Monday progress was being made.

It wasn't clear if the market was reacting to the death of ISIS leader Abu Bakr al-Baghdadi, who died Saturday during a raid on his compound in Syria.

In addition to the usual big-tech names, semiconductors also surged, with the Philadelphia Semiconductor Index up 1.75% and hitting a new intraday high as well. Lam Research (NASDAQ:LRCX) hit new highs and Qualcomm (NASDAQ:QCOM) and Advanced Micro Devices (NASDAQ:AMD) were leaders in the group.

Banks pushed higher with new highs for Bank of America (NYSE:BAC) and Citigroup (NYSE:C), as well as JPMorgan Chase. Goldman Sachs (NYSE:GS), up 1.63%, was the third-best performer among the 30 Dow stocks after Microsoft and 3M Company (NYSE:MMM).

With Monday's close, the S&P 500 was up 21% for the year, with the Dow up 16.1% and the Nasdaq up 25.5%.

But a little context is in order because the drubbing the market sustained in the fourth quarter of 2018. So, compared with the market's 2018 peaks, the S&P 500 is up 3.35%. The Dow is up 0.5%, with the Nasdaq up 2.37%.

The rally pulled money from bonds, pushing the 10-YearTreasury yield up to 1.847% from Friday's 1.801%.

Rising rates weighed on utilities and real estate stocks. Also lower: consumer staples and energy stocks.

Energy shares were hit by lower oil prices. West Texas Intermediate crude fell 85 cents to $55.81 a barrel. Brent crude also fell 45 cents to $61.47. Gold futures fell $9.50 to $1,495.80 in New York.

Tiffany & Co (NYSE:TIF), asset manager Affiliated Managers Group (NYSE:AMG), biotech company Illumina (NASDAQ:ILMN) and meat-processor Tyson Foods (NYSE:TSN) were among the S&P 500 leaders Monday.

Industrial-real-estate developer Prologis (NYSE:PLD), Molson Coors Brewing (NYSE:TAP), Cabot Oil & Gas (NYSE:COG) and home builder DR Horton (NYSE:DHI) were among the weakest.

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