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Stocks - Dow, S&P Hit New Highs on China Trade Deal Hopes

Published 11/04/2019, 03:50 PM
Updated 11/04/2019, 05:07 PM
© Reuters.
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Investing.com – The stock-market party rolled on Monday with the Dow joining the S&P 500, Nasdaq, and Nasdaq 100 indexes in hitting record highs.

If there was a downside, it was that most of the gains came soon after the market opened and faded a bit by the close.

The Dow Jones industrials finished up 0.42%, or 115 points, at 27,462 but the blue chips had surged more than 170 points in the first half hour of trading.

The S&P 500 rose 0.37% to a new record close and hit a new intraday high of 3,085.20. The Nasdaq Composite added 0.56% and hit an intraday peak of 8,451.37. The Nasdaq 100 finished up 0.61% after hitting an intraday record of 8.223.33.

The catalyst was the firm belief that a phase one trade deal between the United States and China is coming. It was backed up by positive comments even from China. So, maybe this time, something will happen.

But there are risks. Politico reported this afternoon China was demanding the Trump Administration remove tariffs scheduled to take effect in December and tariffs imposed in September before it will sign a deal.

The market was subject to some profit-taking, particularly among the Dow stocks that suggested many investors (or their algorithms) are taking a show-me attitude toward the pronouncements. Home-building shares were off, including two of the biggest: PulteGroup (NYSE:PHM) and DR Horton (NYSE:DHI).

At the same time, the market may be pressured Tuesday after Uber Technologies (NYSE:UBER) results beat estimates on the bottom line but still showed big losses. While CEO Dara Khosrowshahi told CNBC Monday afternoon he expects the company will be showing positive earnings before interest, taxes, depreciation and amortization in 2021, shares were off more than 5% after hours.

Energy, industrial and financial stocks were the strongest sectors. Utilities and real estate shares were the laggards, in part because of rising interest rates. Interest rates were higher. The 10-Year Treasury yield was at 1.781% from Friday's 1.728%.

More than 270 stocks hit new highs, including Apple (NASDAQ:AAPL), Bank of America (NYSE:BAC), JPMorgan Chase (NYSE:JPM), Deere (NYSE:DE), Caterpillar (NYSE:CAT), Honeywell (NYSE:HON), United Technologies (NYSE:UTX) and AT&T (NYSE:T).

Boeing (NYSE:BA) was nowhere near a new high, but its 1.71% gain to $351.09 did contribute about 40 points to the Dow's gain.

Crude oil finished higher, although gains of 2% or higher faded to under 1%. Gold Futures were flat at $1,511.10 an ounce in New York.

Cimarex Energy (NYSE:XEC), Pioneer Natural Resources (NYSE:PXD), Devon Energy (NYSE:DVN) and Noble Energy (NYSE:NBL) were among the top S&P 500 performers.

Under Armour (NYSE:UA), PulteGroup (NYSE:PHM), Motorola Solutions (NYSE:MSI) and DR Horton (NYSE:DHI) were among the weakest S&P 500 performers.

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