The trading floor on the final day of trading for the year at the New York Stock Exchange (NYSE) in New York City, December 29, 2017. Photo: Reuters
Wall Street’s major indexes were higher on the first trading session of the year on Tuesday, driven by technology and consumer discretionary stocks, setting the stage for another year of robust gains for equities.
Major stock indexes closed out 2017 with their best performances since 2013 and are expected to gain this year too, largely helped by a cut in corporate taxes that is anticipated to boost profits and the economy.
“It is seasonally a very good time for equities as new money comes into work,” said John Brady, senior vice president at futures brokerage R.J. O‘Brien & Associates in Chicago.
“It seems as if most economists have raised their GDP forecast for 2018, and we’re going to get some form of a fiscal stimulus into an economy that has a tight labor market. The market is pricing all of this in.”
Gains in Apple (AAPL.O), Facebook (FB.O), Alphabet (GOOGL.O) and Microsoft (MSFT.O) pulled the technology index .SPLRCT higher. The index had gained 36.9 percent in 2017, the best performing S&P sector.
People are back to looking at what have been the winners. It has been very momentum driven,” said Rick Meckler, president of hedge fund LibertyView Capital Management LLC in Jersey City, New Jersey.
The S&P consumer discretionary index .SPLRCD was up 1.16 percent, boosted by Walt Disney’s (DIS.N) 1.8 percent rise and a 4.6 percent jump in Netflix (NFLX.O) following broker Macquire’s upgrade to “outperform”.
Other media stocks such as Discovery Communications (DISCA.O), Twenty-First Century Fox (FOXA.O) and Comcast (CMCSA.O) also moved higher.
Oil prices dipped but hovered near their mid-2015 highs amid large anti-government rallies in major exporter Iran and ongoing supply cuts led by OPEC and Russia. [O/R]
Gold and copper prices extended their gains, but the greenback began the year on the back foot, with the dollar index .DXY slipping to its weakest level since September.
The week is heavy on data including December job numbers and reports on manufacturing and service sectors scheduled. The data will be closely watched for signs of further strength in the economy and the number of interest rate hikes this year.
Minutes from the Federal Reserve’s December meeting, where the central bank raised rates for the fourth time since the 2008 financial crisis, is set for release on Wednesday.
At 10:50 a.m. ET (1550 GMT), the Dow Jones Industrial Average .DJI was up 61.97 points, or 0.25 percent, at 24,781.19 and the S&P 500 .SPXwas up 16.91 points, or 0.63 percent, at 2,690.52.
The Nasdaq Composite .IXIC was up 79.83 points, or 1.16 percent, at 6,983.22.
Shares of casino operators Wynn Resorts (WYNN.O) and Melco Resorts & Entertainment (MLCO.O) were down about 2 percent after a report showed lower-than-expected rise in Macau gambling revenue in December.
Abbott Labs (ABT.N) jumped more than 3 percent to a record $59.02 after two brokerages upgraded the company’s stock to “overweight”.
Advancing issues outnumbered decliners on the NYSE by 1,951 to 831. On the Nasdaq, 2,097 issues rose and 730 fell.