Wall Street ticks higher to record close; eyes on earn­ings and Fed

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Ma­jor stock in­dexes edged up to post record clos­ing highs on Wed­nes­day with sec­tor moves in the S&P 500 show­ing pref­er­ence to­ward so-called de­fen­sive stocks.

AROUND THE WORLD

NEW YORK — Ma­jor stock in­dices edged up to post record clos­ing highs on Wed­nes­day with sec­tor moves in the S&P 500 show­ing pref­er­ence to­ward so­called de­fen­sive stocks.

While Wall Street re­ac­tion was muted to min­utes of the most re­cent Fed­eral Re­serve pol­icy meet­ing, a re­port that a mar­ket­friendly can­di­date was be­ing pushed as suc­ces­sor to Janet Yellen at the helm of the US cen­tral bank helped in­dices close near the highs of the day.

Real es­tate, util­i­ties, and con­sumer sta­ples were among S&P 500 sec­tors that posted gains, while fi­nan­cials were pres­sured by a slip in Trea­sury yields and in­dus­tri­als also fell.

“You’ve got sec­tor ro­ta­tion grind­ing the in­dices higher and it’s hard to see what stops that,” said Art Hogan, chief mar­ket strate­gist at Wun­der­lich Se­cu­ri­ties in New York.

Fed­eral Re­serve pol­icy mak­ers had a pro­longed de­bate about the prospects of a pickup in in­fla­tion dur­ing their Septem­ber meet­ing, but many pol­icy mak­ers still felt that an­other rate in­crease this year “was likely to be war­ranted.”

“Noth­ing changes the opin­ion that the Fed is likely to hike rates after the De­cem­ber meet­ing,” Mr. Hogan said.

Stocks ended near ses­sion highs after a re­port from Politico said Trea­sury Sec­re­tary Steven Mnuchin was push­ing Pres­i­dent Don­ald Trump to name Jerome Pow­ell, seen as a safe pick for fi­nan­cial mar­kets, as the next Fed­eral Re­serve chair­man.

“The mar­ket prefers sta­tus quo,” said Ken Pol­cari, direc­tor of the NYSE floor di­vi­sion at O’Neil Se­cu­ri­ties. “Ev­ery­one knows rates are go­ing up but they pre­fer the pol­icy that Yellen has laid out. Maybe the mar­ket is telling you it thinks it’s go­ing to be sta­tus quo.”

Mr. Pow­ell is seen as closer pol­icy-wise to Ms. Yellen than an­other front-run­ner, Kevin Warsh.

The Dow Jones In­dus­trial Av­er­age rose 42.21 points, or 0.18%, to end at 22,872.89, the S&P 500 gained 4.60 points, or 0.18%, to 2,555.24 and the Nas­daq Com­pos­ite added 16.30 points, or 0.25%, to 6,603.55.

Gains in Wal-Mart and John­son & John­son nudged the Dow Jones In­dus­trial Av­er­age to an­other record high but de­clines in fi­nan­cials kept gains on the S&P 500 in check.

John­son & John­son rose 2.10% to $136.65 after Jef­feries up­graded the stock to “buy,” say­ing the com­pany’s pharma di­vi­sion would help it top an­a­lysts’ profit es­ti­mates.

The con­sumer sta­ples sec­tor got a boost from Wal-Mart, which rose 1.90%, and from Kroger, which jumped 1.20% to $20.78 after news it was ex­plor­ing the sale of its nearly 800 con­ve­nience stores.

Banks take the fo­cus as JPMor­gan Chase and Cit­i­group re­port re­sults on Thurs­day, with an­a­lysts warn­ing that re­sults in the sec­tor will largely be held back by low trad­ing vol­umes com­pared with a year ear­lier.

“Third- quar­ter re­sults of large banks are ex­pected to be tepid,” said Stephen Big­gar, an an­a­lyst at Ar­gus Re­search. “Trad­ing rev­enue (will be) down due to low volatil­ity and loan growth re­main­ing flat to slightly neg­a­tive.”

With the S&P 500 up 14% in 2017, in­vestors are bet­ting on strong earn­ings growth across the S&P 500.

Ad­vanc­ing is­sues out­num­bered de­clin­ing ones on the NYSE by 1.49-to-1; on Nas­daq, a 1.01-to-1 ra­tio fa­vored ad­vancers. About 5.67 bil­lion shares changed hands in US ex­changes, com­pared with the 6.10 bil­lion daily av­er­age over the last 20 ses­sions. —

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