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Trump: S&P 500's Record High Is 'Big Win for Everyone!'

Trump: S&P 500's Record High Is 'Big Win for Everyone!'

Monday, 28 October 2019 04:24 PM

The S&P 500 hit a record high on Monday, while the Nasdaq hovered just below its lifetime high touched in late July, as a more conciliatory tone between the United States and China buoyed hopes for a possible trade deal and investors anticipated a rate cut by the Federal Reserve later this week.

Microsoft Corp (MSFT) shares climbed 2.54%, making the stock among the biggest boosts to each of three major indexes after the technology giant won the Pentagon’s $10 billion cloud computing contract, beating out Amazon.com Inc (AMZN).

The S&P 500 rose as much as 0.7% to 3,044.08, breaching the record intraday high hit on July 26, while the Nasdaq was less than 0.2% below its intraday high. The Dow Jones Industrial Average was less than 1% away from its record intraday level.

President Donald Trump appaluded the record.

"The S&P just hit an ALL TIME HIGH. This is a big win for jobs, 401-K’s, and, frankly, EVERYONE! Our Country is doing great. Even killed long sought ISIS murderer, Al-Baghdadi. We are stronger than ever before, with GREAT upward potential. Enjoy!" he wrote on Twitter.

Trump said on Monday he expected to sign a significant part of the trade deal with China ahead of schedule but did not elaborate on the timing, building on optimism from Friday when Washington said it was “close to finalizing” some parts of a trade deal.

Economic data shows that the trade war between the two largest economies has begun take a toll on both countries, leading to worries about a global slowdown.

Global central banks have responded by easing monetary policy. The Federal Reserve is expected to be the latest to follow that trend at its two-day policy meeting beginning on Tuesday, with wide expectations that it will cut interest rates for a third time this year.

“It just seems like the things that would disrupt the rally – tightening monetary policy - off the table. Some kind of big battle with the Chinese seems to be off the table, some kind of political upheaval seems be off the table,” said Stephen Massocca, senior vice president at Wedbush Securities in San Francisco. “All of that means the line of least resistance is higher.”

The Dow Jones Industrial Average rose 140.72 points, or 0.52%, to 27,098.78, the S&P 500 gained 18.44 points, or 0.61%, to 3,040.99 and the Nasdaq Composite added 86.04 points, or 1.04%, to 8,329.16.

The odds for a quarter percentage point cut in U.S. borrowing costs have jumped to 94.1% from 49.2% last month, according to CME Group’s FedWatch tool.

The third-quarter earnings season has managed to ease some concerns related to the impact of the trade tensions on corporate profits, with over 78% of the 204 S&P 500 companies that have reported so far surpassing profit expectations, according to Refinitiv data. Still, third-quarter earnings are expected to show a decline of 2%.

Investors are waiting for earnings from heavyweights this week such as Apple Inc. (AAPL), Google-parent Alphabet Inc. (GOOGL) and Merck & Co. Inc. (MRK).

Chipmakers, which have acted as a proxy for trade tensions with China, gained 1.67%. The technology healthcare and communication services sectors gained more than 1% each.

Among other stocks, AT&T Inc. (T) rose 4.27% after the U.S. wireless carrier said it would add two new board members and consider selling off up to $10 billion worth of non-core businesses next year.

Tiffany & Co. (TIF) surged 30.88% after Louis Vuitton owner LVMH made a $120 per share offer to buy the U.S. luxury jeweler.

Advancing issues outnumbered declining ones on the NYSE by a 1.42-to-1 ratio; on Nasdaq, a 2.14-to-1 ratio favored advancers.

The S&P 500 posted 39 new 52-week highs and no new lows; the Nasdaq Composite recorded 111 new highs and 37 new lows.

© 2021 Thomson/Reuters. All rights reserved.

Technology stocks pushed the benchmark S&P 500 index to an all-time high and the Nasdaq close to its record level, as a possible U.S.-China trade deal and rising bets on a third rate cut by the Federal Reserve fueled optimism.
stocks, record, high, wall street, s&p 500
Monday, 28 October 2019 04:24 PM
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