Banks help stocks reach new highs
U.S. stocks reached record highs Tuesday as banks kept rising and retailers climbed after some encouraging job data.
It was the second straight day that bank stocks made big gains as bond yields pushed higher, which enables banks to charge higher rates on loans. Retailers rose after the Labor Department said job openings and hiring grew in July, and more people quit their jobs to take new ones. That left investors hopeful that people will shop and spend more.
Chemicals firm DowDuPont climbed after making changes to its breakup plans, as activist investors had urged. Apple’s new iPhones didn’t cause much excitement on Wall Street.
The bond market is “moving back to a comfort zone,” said Matt Toms, chief investment officer for Voya Investment Management’s fixed income business. “Just enough growth, just enough inflation, but not too much of either.”
The Standard & Poor’s 500 index, Dow Jones industrial average and Nasdaq composite all rose to new records.
Bond prices fell. The yield on the 10-year Treasury note rose to 2.16% from 2.13%. That helped banks. Bank of America shares gained 2.5% to $23.95. Citizens Financial Group rose 3% to $34.48.
DowDuPont, which was formed when two of the world’s largest chemical companies combined in August, made some changes to its breakup plan after pressure from activist investors. DowDuPont will break into three public companies. One will focus on agriculture, one on material science and one on specialty products. Tuesday’s changes concern the latter two. DowDuPont shares rose 2.5% to $68.52.
Job openings posted by U.S. employers rose 0.9% to 6.2 million in July, the Labor Department said. That’s the highest on record dating to 2000. Hiring also increased and more people quit their jobs, which often means they were leaving for jobs that pay better.
That helped smaller, domestically focused companies and retailers. Gap jumped 6.4% to $27.61. Victoria’s Secret parent L Brands advanced 3.9% to $39.36.
Energy firms climbed as benchmark U.S. crude rose 16 cents to $48.23 a barrel. Brent crude rose 43 cents to $54.27 a barrel. Wholesale gasoline rose 2 cents to $1.66 a gallon. Heating oil stayed at $1.74 a gallon. Natural gas rose 5 cents to $3 per 1,000 cubic feet.
Gold fell $3 to $1,332.70 an ounce. Silver fell 1 cent to $17.89 an ounce. Copper fell 3 cents to $3.04 a pound.
The dollar rose to 110.11 yen from 109.34 yen. The euro rose to $1.1970 from $1.1962. The British pound climbed to $1.3293 from $1.3173, its highest level in a year.