December starts strong as S& P 500 hits record

Wall Street kicked off December with more milestones Tuesday after a broad rally for stocks pushed the Standard & Poor’s 500 and Nasdaq composite to new highs.

The S& P 500 gained 1.1%, with technology companies and banks driving a big part of the rally. The strong opening to December followed a 10.8% surge for the broad index in November, its best month since April. The techheavy Nasdaq climbed 1.3%. Both indexes beat the record highs they set on Friday.

Stocks have been ramping higher in recent weeks as investors have focused on the possibility that coronavirus vaccines could soon help usher in a fuller global economic recovery. Meanwhile, lawmakers in Washington are debating once more whether to deliver another round of coronavirus relief to the economy before President Trump leaves office.

The S& P 500 rose 40.82 points to 3,662.45. The Dow Jones industrial average gained 185.28 points, or 0.6%, to 29,823.92. The Nasdaq climbed 156.37 points to 12,355.11. Small company stocks also added to their recent gains. The Russell 2000 index picked up 16.23 points, or 0.9%, to 1,836.05.

Although the economic recovery has been stunted by a resurgence of the virus, investors are looking past much of that because of progress on vaccine development. Several pharmaceutical companies have reported encouraging early data recently suggesting their vaccine candidates are highly effective, raising hopes on Wall Street that the economy will begin to turn around next year as the vaccines are distributed to a world beaten down by the COVID- 19 pandemic.

The Organization for Economic Cooperation and Development said in a report that the world economy will bounce back to its prepandemic levels by the end of next year, though the recovery will be uneven across the countries and many risks remain.

Traders are also holding out hope that Democrats and Republicans will reach a deal on some amount of economic stimulus before 2021, but the parties remain divided on the details and the cost.

About 76% of the companies in the S& P 500 rose Tuesday, as did every sector in the index except for industrials. Technology stocks led the way higher, with the Big Tech companies notching gains. Apple rose 3.1% and Microsoft gained 1%. Facebook climbed 3.5%, while Netf lix added 2.8%. Google parent Alphabet rose 2.3% and Amazon gained 1.6%.

Banks, healthcare stocks and companies that rely on direct consumer spending also helped lift the market. JPMorgan Chase gained 1.6% and Pfizer rose 2.9%.

Early in Wall Street’s recovery this spring, it was Big Tech that almost singlehandedly carried the market higher on expectations that work- from- home and other trends would mean bigger profits for them. But lately hopes for a vaccine and return to economic normality have been helping boost stocks of companies whose profits are more closely tied to the economy’s strength.

Treasury yields rose in another sign of investor optimism. The 10- year Treasury yield jumped to 0.93% from 0.83% on Monday.