Banks, energy firms push stocks higher
Wall Street extended its recent run of gains Tuesday, despite a late stumble that nearly wiped out the stock market’s gains for the day.
The S&P 500 rose 0.2 percent after having been up 0.8 percent in the early going.
Banks and energy companies led the gains, outweighing losses in technology stocks, which pulled the Nasdaq composite lower.
Small company stocks did better than the broader market.
The latest gains followed strength in markets overseas as innies vestors welcomed news that European leaders have agreed on a budget and coronavirus relief fund worth more than $2 trillion.
The agreement comes as pressure intensifies on Congress and the White House to reach a deal on another economic aid package before a temporary boost in aid for unemployed Americans expires at the end of the month.
Hope for more economic aid from the government, following Europe’s example, helped put investors in a buying mood Tuesday, said Kristina Hooper, chief global market strategist for Invesco.
“The U.S. does not have the net that Europe has,” she said. “This is an environment in which there is going to be a need for more fiscal stimulus or you could see a real hit to consumers.”
The S&P 500 gained 5.46 points to 3,257.30. It was the index’s third-straight gain.
The Dow Jones Industrial Average rose 159.53 points, or 0.6 percent, to 26,840.40. The Nasdaq dropped 86.73 points, or 0.8 percent, to 10,680.36, a day after notching its best day since the end of April and its latest all-time high.
Small company stocks surged, driving the Russell 2000 index up 19.56 points, or 1.3 percent, to 1,487.51. Indexes in Europe and Asia closed higher.
Treasury yields mostly were lower and the price of gold rose 1.5 percent, signs of continuing caution in the market.
Energy companies were the biggest gainers among the 11 sectors in the S&P 500, by far, as the price of oil headed higher, an encouraging sign that markets hope economies will continue to recover. Occidental Petroleum led all other stocks in the S&P 500, vaulting nearly 11 percent. More than a dozen other energy companies also moved sharply higher.
Technology stocks and compasafety that rely on consumer spending, sectors that are up the most this year, gave up some of their gains after powering a rally a day earlier.
After following up a 20 percent drop in the first three months of the year with a nearly 20 percent gain over the April-June quarter, Wall Street has continued its winning ways so far in July.
The S&P 500 has notched a weekly gain the past three weeks as investors cheered improvements in hiring, retail sales and other parts of the economy, along with rising hopes for a COVID-19 vaccine.