By Echo Wang
NEW YORK (Reuters) - The S&P 500 index closed at record high on Tuesday on gains in Apple and healthcare stocks, despite concerns over a surge in the Delta variant of the coronavirus taking some shine off an upbeat corporate earnings season.
Ten of the 11 S&P indexes traded higher, with energy stocks rebounding after getting hit by a dip in oil prices.
“Even though the pandemic is still with us in certain places where there are pockets of this and that, the broad shutdowns of economies are not going to happen. And I think it demonstrates that consumption patterns are super strong, which is the underlying factor that really keeps markets up,” said Jamie Cox, managing partner at Harris Financial Group in Richmond, Virginia.
Apple Inc (NASDAQ:AAPL) rose 1.26% after sliding last week. Other heavyweight technology stocks, including Netflix Inc (NASDAQ:NFLX), Tesla (NASDAQ:TSLA) Inc and Facebook Inc (NASDAQ:FB), continued to edge lower, capping gains on the tech-heavy Nasdaq.
A clutch of U.S. companies, including industrial materials maker Dupont and Discovery (NASDAQ:DISCA) Inc, reported better-than-expected quarterly results, but their shares fell as investors booked profits amid lofty stock valuations.
A deepening regulatory scrutiny in China has sent jitters through the global technology sector.
Shares in U.S.- and European-listed gaming companies fell after a steep sell-off in China's social media and video games group Tencent, driven by fears the sector could be next in regulators' crosshairs.
"Grand Theft Auto" creator Take-Two (NASDAQ:TTWO) Interactive Software Inc plunged 7.71% after it issued a disappointing sales forecast.
The Dow Jones Industrial Average rose 278.24 points, or 0.8%, to 35,116.4, the S&P 500 gained 35.99 points, or 0.82%, to 4,423.15 and the Nasdaq Composite added 80.23 points, or 0.55%, to 14,761.30.
The S&P 500's previous record closing high was 4,422.30.
Data on Tuesday showed U.S. factory orders rose 1.5% in June after a 2.3% increase in the previous month. Economists polled by Reuters had expected a rise of 1% in June.
Later in the week, focus will shift to data on the U.S. services sector and the monthly jobs report for July.
In M&A-driven moves, Translate Bio (NASDAQ:TBIO) surged 29.23%after France's Sanofi (NASDAQ:SNY) agreed to buy the U.S. biotech company in a $3.2 billion deal.
Under Armour Inc (NYSE:UAA) and Ralph Lauren Corp (NYSE:RL) jumped 6.19% and 6.13% respectively after raising their annual revenue forecasts.
Overall, earnings at S&P 500 firms are estimated to have climbed about 90% in the second quarter versus forecasts of 65.4% at the start of July, according to IBES data from Refinitiv.
“The earnings reports continue to come in very strong or stronger than people expect, which leads me to believe that people are underestimating the strength of recovery,” said Cox.
Volume on U.S. exchanges was 9.28 billion shares, compared with the 9.73 billion average for the full session over the last 20 trading days.
Advancing issues outnumbered declining ones on the NYSE by a 1.60-to-1 ratio; on Nasdaq, a 1.05-to-1 ratio favored decliners.
The S&P 500 posted 70 new 52-week highs and 3 new lows; the Nasdaq Composite recorded 91 new highs and 117 new lows.