Stock rally sends S&P 500 within 3% of record high
NEW YORK — Stocks started August with more gains, and a worldwide rally Monday sent Wall Street back to where it was just a couple days after it set its record early this year.
The S&P 500 tacked 0.7% more onto its four-month winning streak, and Big Tech once again led the way. The index rose 23.49 points to 3,294.61 to get within 3% of its record for the first time since February.
The Dow Jones Industrial Average rose 236.08 points, or 0.9%, to 26,664.40. The gains for tech stocks, particularly Microsoft and Apple, pushed the Nasdaq composite up 157.52, or 1.5%, to 10,902.80, another record.
Helping to launch markets higher were reports showing manufacturing activity strengthened across Europe in July by more than economists expected. The gains built higher after a separate report showed U.S. manufacturing growth accelerated last month at a faster pace than economists expected.
Still, “there is clear confusion among investors,” said
Mark Hackett, chief of investment research at Nationwide. Even though the stock market is indicating a steady recovery, he said big moves in the foreign-currency and gold markets are “suggesting greater disruption.”
In Washington, meanwhile, grinding negotiations on another huge relief effort for the U.S. economy are ongoing. Both the Trump administration negotiating team and top Capitol Hill Democrats reported progress over the weekend, though differences remain.
The discussions have taken on more urgency because $600 in weekly benefits for laid-off workers from the federal government have expired, just as the number of layoffs ticks up across the country amid a resurgence of coronavirus counts and business restrictions.
The continued spread of the virus is raising worries that the economy could backslide again and snuff out the budding improvements it’s shown. The shakeout from the pandemic took down two more big retailers over the weekend, with Lord & Taylor and the owner of Men’s Wearhouse both filing for bankruptcy protection Sunday.
Through the pandemic, though, Big Tech has remained almost immune to such concerns on expectations that it can continue to grow.
Microsoft jumped 5.6% Monday after it confirmed that it’s in talks to buy the U.S. arm of TikTok, a Chineseowned video app that is very popular but has also drawn the White House’s scrutiny. Microsoft said its chief executive, Satya Nadella, has talked with President Donald Trump about it, and the tech giant expects the talks with TikTok to end no later than Sept. 15 one way or the other.
Apple added 2.5%, piling more gains onto its 10.5% rise Friday following a blowout report showing that its profits during the spring easily topped Wall Street’s expectations.
Across the market, corporate profits have come in for the spring that weren’t quite as bad as analysts were expecting. Roughly two-thirds of the way into earnings season, 84% of S&P 500 companies have reported stronger results than expected, according to FactSet. If it stays at that level, it would be the highest since FactSet’s records began in 2008.
The yield on the 10-year Treasury rose to 0.55% from 0.53% late Friday.
Benchmark U.S. crude rose 1.8% to settle at $41.01 per barrel. Brent crude, the international standard, climbed 1.4% to $44.15 per barrel.