New Highs for US Stocks 02/27 17:02
Wall Street notched another set of milestones Monday as the Dow Jones
industrial average closed at a record high for the 12th consecutive time, the
longest winning streak for the 30-company average in 30 years.
(AP) -- Wall Street notched another set of milestones Monday as the Dow
Jones industrial average closed at a record high for the 12th consecutive time,
the longest winning streak for the 30-company average in 30 years.
The Standard & Poor's 500 index, the benchmark favored by professional
investors, also closed at a record high.
The latest push into the record books came on an indecisive day for U.S.
stocks that sent indexes wavering between small gains and losses for much of
the day. They ultimately eked out tiny gains, led by energy stocks, which
climbed as the price of crude oil rose. Phone companies lagged the most.
Many investors were taking a wait-and-see approach ahead of President Donald
Trump's speech to Congress on Tuesday, hoping for details of promised tax cuts,
infrastructure spending and other business-friendly policies.
"It's all about policy now," said Phil Blancato, CEO of Ladenburg Thalmann
Asset Management. "There's only so much the market can deliver when there's
still these many unknowns, specifically the Washington impact is now as much a
head wind as it is a tail wind."
The Dow Jones industrial average rose 15.68 points, or 0.1 percent, to
20,837.44. The S&P 500 gained 2.39 points, or 0.1 percent, to 2,369.73. The
Nasdaq composite index added 16.59 points, or 0.3 percent, to 5,861.90.
Small-company stocks fared better than the other indexes, sending the Russell
2000 index up 13.44 points, or 1 percent, to 1,407.97.
The last time the Dow posted a longer winning streak was in early January
1987, when the average rose for 13 days in a row. That streak translated into a
gain of 11 percent for the Dow. Nine months later, on Oct. 19, 1987, the Dow
plummeted more than 500 points, or about 22 percent, on what became known as
Just because the Dow is on another lengthy winning streak doesn't mean a
similar market slump is in the cards now, noted Ryan Detrick, a senior market
strategist for LPL Financial.
One key difference is that the Dow went on to gain another 30 percent in the
months after the 13-day streak in January 1987. By comparison, the Dow is now
up about 5.4 percent this year, so there's a long way to go before the market
becomes as stretched as it was 30 years ago, Detrick said.
"That isn't to say a normal correction after the big surge since the U.S.
election isn't possible, it is, but a major bear market correction is still
something we'd call a low percentage scenario right now," he said.
U.S. stocks have benefited from the Trump administration's promise of
pro-business changes, but investors have become uneasy over how large and rapid
those changes will be.
During a meeting with governors Monday, Trump noted that his upcoming budget
would include a big boost to defense spending. The White House separately said
that the budget would include a $54 billion increase in defense spending while
imposing corresponding cuts to domestic programs and foreign aid.
Talk of more defense spending gave a lift to defense contractors Monday.
Raytheon added $1.35, or 0.9 percent, to $154.83. Northrop Grumman gained
$3.55, or 1.4 percent, to $248.60. Lockheed Martin climbed $5.18, or 2 percent,
Expectations that the Trump administration will ramp up infrastructure
spending projects also gave materials companies a boost. Martin Marietta
Materials rose $5.21, or 2.5 percent, to $215.26, while Vulcan Materials added
$2.78, or 2.4 percent, to $120.60. Summit Materials gained 50 cents, or 2.1
percent, to $24.25.
Trump's speech Tuesday to a joint session of Congress is expected to include
more details of how the administration plans to carry out promises to cut taxes
and step up infrastructure spending.
"The markets had this incredible run, much of it based on potential tax
policy, and what everyone wants to see tomorrow night is some more details,"
said JJ Kinahan, chief market strategist at TD Ameritrade.
Traders also weighed the latest crop of company earnings and outlooks.
Tegna climbed 3.5 percent after the media company's latest earnings beat
Wall Street's estimates. The stock rose 86 cents to $25.66.
Power company AES fell 6.6 percent after its full-year profit forecast
disappointed investors. The stock lost 79 cents to $11.14.
Consumer stocks were among the biggest decliners as shares in several
supermarket operators fell. Kroger slid $1.07, or 3.2 percent, to $32.22, while
Whole Foods Market dipped 46 cents, or 1.5 percent, at $31.10.
Major stock indexes overseas were mixed.
Benchmark U.S. crude rose 6 cents to close at $54.05 a barrel in New York.
Brent crude, used to price international oils, slipped 6 cents to close at
$55.93 in London.
Bond prices fell. The 10-year Treasury yield rose to 2.37 percent from 2.32
percent late Friday.
In Europe, Germany's DAX rose 0.2 percent, while France's CAC-40 was flat.
London's FTSE-100 added 0.1 percent. In Asia, Tokyo's Nikkei 225 index fell 0.9
percent. Hong Kong's Hang Seng slid 0.2 percent. Seoul's Kospi shed 0.4
percent. Sydney's S&P-ASX 200 lost 0.3 percent.
The dollar rose to 112.80 yen from Friday's 111.98 yen. The euro rose to
$1.0589 from $1.0565.
In other energy trading, wholesale gasoline added 2 cents to $1.53 a gallon,
while heating oil was little changed at $1.64 a gallon. Natural gas futures
shed 9 cents, or 3.4 percent, at $2.69 per 1,000 cubic feet.
Among metals, the price of gold edged up 50 cents to $1,258.80 an ounce.
Silver added 2 cents to $18.35 an ounce. Copper rose a penny to $2.69 a pound.