Wall St. extends run of record highs; services data upbeat

Business


NEW YORK (Reuters) – U.S. stocks edged up to extend their run of record closing highs on Wednesday as data on the services sector added to signs of strength in the economy and prospects for earnings.

It was the third straight session where all three major indexes hit record closing highs, though the small-cap Russell 2000 broke its string of eight all-time high finishes, ending down 0.3 percent.

Shares of Netflix (NFLX.O) helped lift the S&P 500, rising 2.9 percent, after UBS raised its price target on the company. Shares of Amazon (AMZN.O), up 0.9 percent, gave the index its biggest boost.

Market gains were limited as a decline in oil prices CLc1 weighed on energy shares, and the S&P information technology index .SPLRCT, up about 26 percent this year, posted its first drop in seven sessions. The S&P energy index .SPNY was down 0.1 percent and the technology index was down 0.2 percent.

The vast U.S. services sector overcame hurricane-related snags to expand at its fastest pace in 12 years.

“It’s been an overall quiet market, and I think it’s waiting for the earnings season and maybe some bigger economic data,” said Paul Nolte, portfolio manager at Kingsview Asset Management in Chicago.

“We’ve seen economic data, especially manufacturing data both here in the United States as well as globally, better, so it should be a better earnings season.”

Analysts expect third-quarters earnings of S&P 500 companies rose 5.5 percent in the third quarter from a year earlier, according to Thomson Reuters data. That would be down from double-digit growth in the first two quarters, but many strategists are optimistic results will be better than expected.

The Dow Jones Industrial Average .DJI rose 19.97 points, or 0.09 percent, to end at 22,661.64, the S&P 500 .SPX gained 3.16 points, or 0.12 percent, to 2,537.74 and the Nasdaq Composite .IXIC added 2.91 points, or 0.04 percent, to 6,534.63.

Traders work on the floor of the New York Stock Exchange (NYSE) in New York, U.S., October 4, 2017. REUTERS/Brendan McDermid

Stocks have been hitting record highs on stronger economic data and President Donald Trump’s tax overhaul plan. On Monday, data showed a measure of U.S. manufacturing activity surged to a near 13-1/2-year high in September.

The rest of the week is loaded with economic data, culminating in Friday’s nonfarm payrolls report for September.

Allaying fears of fresh turmoil in the Trump administration, U.S. Secretary of State Rex Tillerson denied reports he considered resigning.

Investors had worried that another administration departure could weigh on Trump’s efforts to push through the tax reform program, a key 2016 campaign promise.

Health and Human Services Secretary Tom Price resigned on Sept. 29 following an uproar over his use of costly private charter planes for government business.

Shares of Mylan (MYL.O) surged 16.2 percent and was the biggest percentage gainer in the S&P 500 after U.S. regulators approved its copycat version of Teva’s blockbuster multiple sclerosis drug. Teva Pharmaceutical (TEVA.N) slumped 14.6 percent. The S&P healthcare index .SPXHC was up 0.5 percent.

Wells Fargo (WFC.N) was down 1.1 percent after the bank said it would refund some mortgage rate lock extension fees.

Declining issues outnumbered advancing ones on the NYSE by a 1.05-to-1 ratio; on Nasdaq, a 1.01-to-1 ratio favored decliners.

About 5.8 billion shares changed hands on U.S. exchanges. That compares with the 6.3 billion daily average for the past 20 trading days, according to Thomson Reuters data.

Additional reporting by Gayathree Ganesan and Ankur Banerjee in Bengaluru; Editing by Jeffrey Benkoe, James Dalgleish and Jonathan Oatis

Our Standards:The Thomson Reuters Trust Principles.



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