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Stocks Advance With S&P 500 Trading Near All-Time High

Stocks Advance With S&P 500 Trading Near All-Time High
(Photo: AP file)

Tuesday, 07 June 2016 08:08 AM

U.S. stocks advanced, even after the S&P 500 Index pared much of its gain in the final hour of trading, as rallies in energy producers and airline operators offset slumping health-care and bank shares.

The benchmark reached a level that was 0.5 percent below its all-time high on Tuesday. Chevron Corp. and Exxon Mobil Corp. added at least 1.5 percent. The Bloomberg U.S. Airlines Index rose the most in two months after JPMorgan Chase & Co. said JetBlue Airways Corp. raised its domestic fares by $3 each way, spurring other flight operators to match in competing markets. Health-care shares led losses as Biogen Inc. slumped 13 percent after an experimental drug for multiple sclerosis failed in a mid-stage trial.

The S&P 500 added 0.1 percent to 2,112.13 at 4 p.m. in New York, after climbing as much as 0.5 percent. It was still the highest close since July, while volume on U.S. exchanges was 11 percent below the three-month average. The Dow Jones Industrial Average added 17.95 points, or 0.1 percent, to 17,938.28 today, after briefly surpassing the 18,000 level for the first time since April.

“If you look at U.S. stocks on a global perspective, to be touching or near that high is pretty phenomenal,” Gina Martin Adams, an equity strategist at Wells Fargo Securities LLC, said in a Bloomberg TV interview. “Yet when we look forward, we’re struggling to find that next source of growth. Maybe the drag has passed, but where is the growth going to come from? The result of that is this sideways trading market with very limited risk tolerance on the part of the broad investment community.”

Stocks rose yesterday after Federal Reserve Chair Janet Yellen said the economy is making progress despite signs of slower jobs growth, making investors more comfortable with the prospects for gradual rate increases. That’s helped fuel gains in commodity prices. Traders have also cut back their bets for a Fed rate increase after last week’s disappointing jobs report. They are now pricing in almost no chance of a boost in June, and the probability for July has dropped to about 20 percent from 53 percent a week ago.

Energy stocks posted the biggest gains, rising to the highest level since November, as oil advanced before U.S. government data forecast to show crude stockpiles dropped for a third week. All but three stocks in the S&P 500 Energy Index increased.

The S&P Supercomposite Homebuilding Index also jumped after PulteGroup Inc. said Elliott Management Corp. has taken a stake in the homebuilder. PulteGroup climbed 4.1 percent, while Lennar Corp. and Toll Brothers Inc. also rose.

LDR Holding Corp. surged 64 percent. Zimmer Biomet Holdings Inc. agreed to buy the medical device company for about $1 billion in cash to add surgical technologies for the treatment of patients with spine disorders. Zimmer slid 1.7 percent.

Sarepta Therapeutics Inc. soared 23 percent on speculation its experimental muscular dystrophy treatment may have a chance of approval, after U.S. regulators asked the drugmaker for more data.

United Natural Foods Inc. gained 14 percent after boosting its annual earnings and sales forecasts.

Meanwhile, Alexion Pharmaceuticals Inc. tumbled 11 percent after its drug for a rare neuromuscular disease didn’t meet its primary goal in a final-stage trial.

Bank stocks sank with Goldman Sachs Group Inc. posting among the biggest declines in the Dow.

LendingClub Corp. slumped 7.4 percent after postponing its annual meeting, which was scheduled for Tuesday. The arranger of so-called peer-to-peer loans has been seeking to restore investor confidence after the surprise departure last month of its founder.

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U.S. stocks advanced, even after the S&P 500 Index pared much of its gain in the final hour of trading, as rallies in energy producers and airline operators offset slumping health-care and bank shares.
stocks, S&P 500, market, high
Tuesday, 07 June 2016 08:08 AM
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