Tech gains help propel Wall Street to record highs

New York | Updated on January 09, 2018 Published on November 22, 2017

Urban Outfitters rises after earnings; Medtronic gains on upbeat results

US stocks jumped on Tuesday, pushing all three major indexes to record closing highs, led by gains in this year's top-performing technology sector.

Healthcare stocks also rose after bullish results from medical device maker Medtronic, whose shares rose 4.8 per cent after the company reported better-than-expected results and backed its full-year forecast.

The S&P technology index gained 1.2 per cent, helped by a nearly 1.9 per cent rise in Apple. The index has risen 38.6 per cent this year, by far more than any other sector. The S&P 500 is up 16.1 per cent for the year so far.

“We're at a seasonal time of the year where investors are looking to add holdings rather than sell, so we have that upward bias,” said Bucky Hellwig, senior vice-president at BB&T Wealth Management in Birmingham, Alabama.

“There's money that's been on the sidelines most of the year, and stocks have the best risk-adjusted profile right now. Stocks have had little volatility and the trend is upward,” he said, adding: “Tech is something people feel comfortable with right now and so you see money going into it.”

The CBOE Volatility index closed down 0.9 point at 9.73, its lowest close in more than two weeks.

The S&P 500 hit a record closing high for the first time in about two weeks. Indexes posted losses last week as investors worried whether the tax plan in Washington will see progress.

With the third-quarter earnings season winding down and no major economic data in sight, trading activity slowed ahead of Thursday's Thanksgiving holiday.

The Dow Jones Industrial Average rose 160.5 points or 0.69 per cent to 23,590.83, the S&P 500 gained 16.89 points or 0.65 per cent to 2,599.03 and the Nasdaq Composite added 71.76 points or 1.06 per cent to 6,862.48.

The small-cap Russell 2000 index rose 1 percent and also hit a record closing high.

Goldman Sachs raised its earnings estimate for S&P 500 companies in 2018 and 2019 based on expectations of US corporate tax reform, above-trend global and US economic growth and slowly rising interest rates from a low base.

Shares of Urban Outfitters gained 3.7 per cent, while Hormel Foods was up 3.4 per cent. Both reported quarterly results. Signet Jewelers tanked 30.4 per cent after reporting a surprise quarterly loss, pulling down Tiffany 0.8 per cent.

Advancing issues outnumbered declining ones on the NYSE by a 2.10-to-1 ratio; on Nasdaq, a 1.92-to-1 ratio favoured advancers.

About 6.2 billion shares changed hands on US exchanges. That compares with the 6.8 billion daily average for the past 20 trading days, according to Thomson Reuters data.

Published on November 22, 2017
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