Dow, S&P 500 indexes roar to record highs
A strategist says investors see the jumps, including in transportation, as a sign companies will spend more.
The Dow Jones industrial average and Standard & Poor’s 500 indexes Wednesday soared to their biggest gains since the presidential election and set all-time highs. Investors bought stocks that do well in times of faster economic growth, such as technology and industrial companies, and also snapped up stocks that pay large dividends.
Stocks moved steadily higher throughout the day after a mixed open. Phone and real estate companies made the largest gains, and the rally moved into high gear in the afternoon, as airlines, railroads and trucking companies soared.
Biotech drug companies took steep losses after President-elect Donald Trump said he wants to reduce drug prices.
The transportation sector reached an alltime high for the first time in two years. Julian Emanuel, an equity strategist for UBS, said investors see that record as a sign businesses will start spending more, which would bolster economic growth.
The Dow Jones industrial average jumped 297.84 points, or 1.5 percent, to 19,549.62. The Standard & Poor’s 500 index rose 29.12 points, or 1.3 percent, to 2,241.35. The Nasdaq composite recovered from an early loss to rise 60.76 points, or 1.1 percent, to 5,393.76. That was about five points short of its all-time high.
The Russell 2000 index of small-company stocks also recovered from an early loss and set its own a record as it gained 11.84 points, or 0.9 percent, to 1,364.51.
A wide array of companies that stand to benefit from faster economic growth also climbed. Home-improvement retailer Lowe’s rose $3.94, or 5.4 percent, to $76.40 and truck maker Paccar jumped $3.20, or 5 percent, to $67.63. U.S. Steel added $1.54, or 4.3 percent, to $37.49.
IBM led technology companies higher as it rose $4.44, or 2.8 percent, to $164.79. Harddrive maker Western Digital climbed $5.30, or 8.3 percent, to $69.15 after it extended a patent-licensing deal with Samsung.
Benchmark U.S. crude oil lost $1.16, or 2.3 percent, to $49.77 a barrel in New York. Brent crude, the international standard, slid 93 cents, or 1.7 percent, to $53 a barrel in London. Energy companies traded higher Wednesday, although they rose less than the rest of the market.
Gold rose $7.40 to $1,177.50 an ounce.
The Dow index jumped 297.84 points, or 1.5 percent, to 19,549.62, while the Standard & Poor’s 500 index rose 29.12 points, or 1.3 percent, to 2,241.35.