Stocks hit record as US senators reach deal to end shutdown
US stocks advanced on Monday as each of Wall Street’s main scored records in the wake of a deal by US senators to end the federal government shutdown.
US STOCKS advanced on Monday as each of Wall Street’s main scored records in the wake of a deal by US senators to end the federal government shutdown.
Legislation to renew federal funding to the government cleared a procedural hurdle in the Senate and was expected soon to pass votes in the Senate and House of Representatives, allowing government to re-open through Feb. 8.
“You would think something like the threat of a government shutdown or an actual government shutdown would serve as a catalyst to spook some weaker holders out of the market,” said Eric Marshall, portfolio manager and director of research at Hodges Capital Management in Dallas, Texas.
“That hasn’t happened, which speaks to underlying strength of what we’re seeing right now in equity markets.”
Earnings growth of 12.40% is expected for the quarter, according to Thomson Reuters data. Of the 55 companies in the S&P 500 that have reported earnings through Monday morning, 80% have topped expectations, well above the 72% beat rate for the past four quarters.
The Dow Jones Industrial Average rose 142.88 points, or 0.55%, to 26,214.60, the S&P 500 gained 22.67 points, or 0.81%, to 2,832.97 and the Nasdaq Composite added 71.65 points, or 0.98%, to 7,408.03.
Halliburton Co. climbed 6.40% after posting a much bigger- than- expected quarterly profit in the fourth quarter, benefiting from a shale-driven surge in US oil production.
The Nasdaq biotech index rose 3.15% to notch its best day since June 21 after a flurry of merger activity in the sector with French drug maker Sanofi and US-based Celgene splurging a combined total of more than $20 billion.
Shares in US hemophilia specialist Bioverativ soared 61.89% after Sanofi agreed to buy the company for $11.60 billion.
Juno Therapeutics jumped 26.83% after Celgene agreed to buy the biotech for about $9 billion in cash.
In other M&A news, AIG said it would buy reinsurer Validus Holdings for $5.56 billion, sending the target’s shares up 44.03%.
Industrial stocks were one of the few laggards, as woes continued for General Electric, down 0.55 after BofA- Merrill Lynch downgraded its stock. General Electric fell below $ 16 for the first time since 2011 and is down nearly 8% for the year.
Advancing issues outnumbered declining ones on the NYSE by a 1.70-to-one ratio; on Nasdaq, 1.38-to-one ratio favored advancers. The S&P 500 posted 123 new 52-week highs and three new lows; the Nasdaq Composite recorded 202 new highs and 16 new lows. —