S&P and Nasdaq hit record highs as tech and energy stocks rise
The S&P 500 and Nasdaq composite hit a fresh record highs on Monday as gains in large-cap tech and energy stocks lifted the indexes. Investors also kept an eye on surging oil prices after comments from the Russian and Saudi energy ministers.
The tech-heavy Nasdaq broke above a previous intraday high or 6,133, which was set last week, in morning trade. The technology sector rose about a third of a percent with Facebook and Alphabet gaining about half a percent.
The S&P 500 climbed 0.4 percent, with energy advancing more than 1 percent to lead advancers. Energy received a boost from rising oil prices.
West Texas Intermediate futures spiked 2.84 percent to $49.20 per barrel after Russia’s Alexander Novak and Saudi Arabia’s Khalid al-Falih said the two countries agreed to extend a production cut until March 2018.
That said, an increase production from the U.S. could cap energy’s gains, said Jason Pride, director of investment strategy at Glenmede. “Our Take: Oil should trade in the $50-70 range as increased demand is met by supply from U.S. share oil producers,” Pride said in a note Monday.
The comments from al-Falih and Novak helped the Energy Select Sector SPDR Fund (XLE), which tracks the S&P energy sector, climb about 1.4 percent.
The Dow Jones industrial average rose about 90 points, with Johnson & Johnson contributing the most gains. Cisco Systems was the biggest advancer in the 30-stock index as cybersecurity stocks rose on the back of a massive cyberattack.
On Friday, a “ransomware” virus dubbed WannaCry hit 200,000 in more than 100 countries. The virus locked up computers in car factories, hospitals and schools.
President Donald Trump ordered Homeland Security Adviser Tom Bossert to hold an emergency meeting Friday night to assess the threat posed by the attack, Reuters reported.
Meanwhile, North Korea said this weekend it tested a new type of missile that can carry a nuclear warhead. However, the U.S. military’s Pacific Command said on Sunday the type of missile that was fired was “not consistent” with an ICBM and South Korea’s military played down the North’s claim of technical progress on atmospheric re-entry.
Nevertheless, investors managed to largely shrug off those concerns.
“Everything seems to slide off this market,” said Bruce McCain, chief investment strategist at Key Private Bank. “Other than a potentially cataclysmic event in Washington, … I think the slowdown in economic data” could threaten the market in the next 3-to-6 months. “In the meantime, the market continues to hold up with its Teflon curtain.”
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