S&P 500 sets new intraday and closing records
28-Oct-19 16:25 ET
Dow +132.66 at 27090.72, Nasdaq +82.87 at 8325.99, S&P +16.87 at 3039.42
briefing.com
[BRIEFING.COM] The S&P 500 set new record highs on Monday, increasing 0.6% as trade sentiment remained upbeat and investors reacted positively to corporate news. The Nasdaq Composite (+1.0%) and Russell 2000 (+0.9%) pulled out ahead, while the Dow Jones Industrial Average (+0.5%) trailed its peers.
Both the U.S. and China continued to work on "Phase One" of a trade agreement over the weekend, which President Trump said is "ahead of schedule" for him to sign. China's state-run media reported that technical consultations on parts of the text were "basically completed."
Technology stocks outperformed, with Microsoft (MSFT 144.19, +3.46, +2.5%) providing influential leadership for the broader market and S&P 500 information technology sector (+1.3%) after it was awarded a $10 billion cloud contract with the Department of Defense.
The tech sector also benefited from strength in the semiconductor space, which tends to rise when sentiment on trade is favorable. The Philadelphia Semiconductor Index rose 1.8%. Following suit were the communication services (+1.2%) and health care (+1.0%) sectors, while the utilities (-1.3%) and real estate (-1.1%) sectors fell noticeably.
Contributing to the advance in the communication services sector were solid gains in Alphabet (GOOG 1290.00, +24.87, +2.0%) and AT&T (T 38.49, +1.58, +4.3%). Alphabet set an all-time high amid heavier-than-usual volume in front of its earnings report, while AT&T announced a multi-year plan to increase shareholder value, which was viewed favorably by activist investor Elliott Management.
Monday also saw some notable M&A activity. Alphabet is reportedly in talks to acquire Fitbit (FIT 5.64, +1.33, +30.9%). Tiffany & Co. (TIF 129.72, +31.17, +31.6%) received a $14.5 billion unsolicited offer from LVMH for $120 per share in cash. Liberty Property Trust (LPT 57.50, +6.93, +13.7%) agreed to be acquired by Prologis (PLD 85.89, -4.97, -5.5%) for about $12.6 billion in an all-stock deal.
In earnings news, Spotify (SPOT 140.20, +19.51, +16.2%) reported a surprise profit and reported MAU growth above expectations. Dow component Walgreens Boots Alliance (WBA 55.80, +0.38, +0.7%) didn't draw much attention following its mostly in-line results.
U.S. Treasuries finished lower in a curve-steepening trade. The 2-yr yield increased two basis points to 1.65%, and the 10-yr yield increased five basis points to 1.85%. The U.S. Dollar Index declined 0.1% to 97.74. WTI crude lost 0.9%, or $0.49, to $55.95/bbl to end a four-session winning streak.
Monday's economic data was limited to the Advance reports for International Trade in Goods, Retail Inventories and Wholesale Inventories for September:
- The Adv. Intl. Trade in Goods report for September showed a deficit of $70.4 billion, which was an improvement from the August deficit of $73.1 billion. An advance report for retail inventories showed a 0.3% increase, versus a 0.2% decline in August, while the advance report for wholesale inventories showed a 0.3% decline, versus an unchanged reading for August.
Looking ahead, investors will receive the Conference Board's Consumer Confidence Index for October, Pending Home Sales for September, and the S&P Case-Shiller Home Price Index for August on Tuesday.
- Nasdaq Composite +25.5% YTD
- S&P 500 +21.2% YTD
- Russell 2000 +16.6% YTD
- Dow Jones Industrial Average +16.1% YTD
Market Snapshot
| Dow | 27090.72 | +132.66 | (0.49%) | | Nasdaq | 8325.99 | +82.87 | (1.01%) | | SP 500 | 3039.42 | +16.87 | (0.56%) | | 10-yr Note | -4/32 | 1.844 |
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| | NYSE | Adv 1558 | Dec 1301 | Vol 776.7 mln | | Nasdaq | Adv 1980 | Dec 1158 | Vol 1.9 bln |
Industry Watch
| Strong: Information Technology, Communication Services, Health Care |
| | Weak: Real Estate, Utilities, Energy |
Moving the Market
-- S&P 500 sets new intraday high, closing record amid trade optimism, upbeat corporate news, fear of missing out on further gains
-- Strength in the technology sector, particularly in Microsoft (MSFT) and in the semiconductor space
-- Notable M&A activity
-- Alphabet (GOOG) rises in front of its earnings report after the closing bell
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