S&P closes in on record as tech stocks climb

Updated: Tue, Aug 07, 2018
09:15 pm
Reuters
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The benchmark S&P 500 was within striking distance of a record high on Tuesday, powered by gains in technology stocks, with a strong second-quarter earnings season fueling optimism about the strength in the U.S. economy.

The index was up 0.40 percent at 2,861.75, about half a percent away from the record it hit on Jan. 26. The Dow Jones Industrial Average was up 0.69 percent, still 3.6 percent short of 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 21.84 points, or 0.28 percent, at 7,881.51.

Shares of high-flying stocks, including those of Google`s parent Alphabet, Microsoft and Intel were trading up between 0.4 percent and 1.7 percent. They helped drive a 0.3 percent gain in the S&P tech sector.

Technology and energy stocks have been at the center of a sharp recovery in the S&P since a market rout in February.

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

Financials rose 1 percent, buoyed by higher yields on the 10-year U.S. treasury note.

JPMorgan rose 0.8 percent, while Bank of America gained 0.7 percent.

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.

"Strong earnings is part of what has kept the market buoyant and one of the reasons why we`re in an uptrend right now," said Randy Frederick, vice president of trading and derivatives for Charles Schwab in Austin, Texas.

The energy index rose 0.99 percent, the most among the S&P sectors, as oil prices gained on expectations of tighter global supplies following United States sanctions on Iran. [O/R]

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

Broadridge Financial rose 8.8 percent and Mosaic 6.2 percent after reporting quarterly results and were the biggest gainers on the S&P.

Walt Disney rose 0.7 percent ahead of its results later in the day.

Marriott International fell 2 percent after the world`s largest hotel chain signaled weakness in revenue per available room (revPAR) in North America for the third quarter.

Advancing issues outnumbered decliners by a 1.79-to-1 ratio on the NYSE and by a 1.74-to-1 ratio on the Nasdaq.

The S&P index recorded 27 new 52-week highs and two new lows, while the Nasdaq recorded 84 new highs and 46 new lows.

(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)

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