The Closing Bell: Dow, S&P 500 And Nasdaq All Climb To Records As Stock Market Extends Gains

Ted

FYI: Stocks jumped toward new highs Monday, lifted by rallying bank and energy shares and optimism on progress on U.S.-China trade negotiations.

The Dow Jones Industrial Average rose 114 points, or 0.42%, to 27462, closing at record since July.

The S&P 500 added 0.37% and the Nasdaq Composite advanced 0.56%, to post fresh closing highs.

After drifting along in a narrow range for months, major indexes have climbed to record territory in recent days. Earnings, while mixed, have mostly proved to be better than investors had feared, and economic data also have shown resilience by U.S. consumers.

Stocks around the world jumped Monday, with the Stoxx Europe 600 up 1%, Hong Kong’s Hang Seng ending up 1.6% and South Korea’s Kospi rising 1.4%.

Among the biggest winners in the U.S. were so-called cyclical sectors that investors tend to gravitate toward when they are more optimistic about growth.

Bank shares jumped, with Morgan Stanley rising 2.8%, Bank of America up 1.9% and Goldman Sachs climbing 1.2%. Energy shares also rallied to follow crude-oil prices higher.

The two sectors, along with industrial shares, had been among the worst hit in prior months when fears about the trade war’s impact on the economy triggered waves of selling. On Monday, they helped lead the market higher, while bond proxies such as utilities shares were among the biggest laggards.

As stocks have climbed, a closely watched signal of recession risk in the bond market also has eased up.

Shorter-term bond yields, which for months had been trading above longer-term ones in a phenomenon known as an inverted yield curve, have returned below longer-term yields in recent weeks. That is a relief to analysts who note that the U.S. economy has typically tipped into recession in the months to years after the yield curve has inverted.

Signs that central banks will extend their shift to more accommodative policy also have helped buoy markets throughout the year. The Federal Reserve cut interest rates for the third time this year last Wednesday, signaling it would likely leave rates unchanged from there barring a sharper-than-expected slowdown in the economy.

While the broader market rallied Monday, some stocks lagged behind.

 Under Armour shares slumped 18% after The Wall Street Journal reported that the sportswear maker’s accounting practices are being probed by federal authorities. The company also pared its full-year revenue forecast as it reported third-quarter results.

McDonald’s fell 2.8% after the fast-food company announced the dismissal of Chief Executive Steve Easterbrook because of his consensual relationship with an employee.
Regards,
Ted

MarketWatch:
https://www.marketwatch.com/story/dow-poised-to-mark-its-first-record-in-about-four-months-mcdonalds-shares-set-to-fall-2019-11-04/print

WSJ:
https://www.wsj.com/articles/global-stocks-are-buoyed-by-optimism-over-earnings-trade-11572861532?mod=hp_lead_pos1

Bloomberg:
https://www.bloomberg.com/news/articles/2019-11-03/stocks-in-asia-to-climb-aussie-gains-on-trade-markets-wrap

IBD:
https://www.investors.com/all-categories/dow-jones-surges-to-all-time-high-chevron-exxon-mobil-lead/

CNBC:
https://www.cnbc.com/2019/11/04/dow-futures-open-us-china-trade-deal-uber-marriott.html

Reuters:
https://uk.reuters.com/article/us-usa-stocks/trade-deal-hopes-propel-wall-street-to-record-high-idUKKBN1XE1AO

U.K:
https://uk.reuters.com/article/uk-britain-stocks/ftse-hits-one-month-high-on-u-s-china-trade-deal-hopes-idUKKBN1XE0Q2

Europe:
https://www.reuters.com/article/us-europe-stocks/trade-optimism-propels-european-shares-to-near-two-year-highs-idUSKBN1XE0PK

Asia:
https://www.cnbc.com/2019/11/04/asia-markets-november-4-us-china-trade-huawei-currencies.html

Bonds:
https://www.cnbc.com/2019/11/04/us-bonds-treasury-yields-in-focus-amid-hopes-of-us-china-trade-deal.html

Currencies:
https://www.cnbc.com/2019/11/04/forex-markets-european-central-bank-in-focus.html

Oil
https://www.cnbc.com/2019/11/04/oil-markets-us-china-trade-in-focus.html

Gold:
https://www.cnbc.com/2019/11/04/gold-markets-us-china-trade-us-economy-in-focus.html

WSJ: Markets At A Glance:
https://markets.wsj.com/us

Major ETFs % Change:
https://www.barchart.com/etfs-funds/etf-monitor

SPDR's Sector Tracker:
http://www.sectorspdr.com/sectorspdr/tools/sector-tracker

SPDR's Bloomberg Sector Performance Pie Chart:
https://www.bloomberg.com/markets/sectors

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