Nasdaq S&P 500 scale new peaks, Dow rallies; Caterpillar jumps 3.4%
The Nasdaq the S&P 500 indexes hit all-time highs on Thursday, with the Dow also jumping, as US President Joe Biden embraced a bipartisan Senate infrastructure deal.
After the US economy grew at a 6.4% annualized rate in the first quarter, thanks to the massive fiscal stimulus, investors have been banking on an infrastructure agreement that could steer the next leg of the recovery for the world’s largest economy.
Caterpillar jumped 3.4% Boeing rallied 2.2%, helping lift the Dow Jones Industrial Average.
“In the short term, I think there will be some ‘buy the rumor sell the news’ in materials industrials, but as we start to see more details come out about how the money will be spent, I think we will get a continued benefit,” said Sal Bruno, chief investment officer at IndexIQ in New York.
Tesla Inc rose 5% after Chief Executive Officer Elon Musk said he would list SpaceX’s space internet venture, Starlink, when its cash flow is reasonably predictable, adding that Tesla shareholders could get preference in investing.
Mega-caps Microsoft Corp, Netflix Inc Facebook Inc gained between 0.4% 1.3% were among the biggest boosts to the S&P 500 the Nasdaq.
Initial claims for state unemployment benefits fell 7,000 to 411,000 for the week ended June 19, the Labor Department said on Thursday, but were still higher than the 380,000 that economists had forecast.
The Commerce Department said the economy grew at a 6.4% rate last quarter, unrevised from the estimate published in May.
So far this month, the S&P 500 growth index has gained almost 4%, outperforming the value index’s 2% drop.
The Dow Jones Industrial Average was up 1.04% at 34,225.35 points, while the S&P 500 gained 0.66% to 4,269.79.
The Nasdaq Composite added 0.72% to 14,374.56.
The S&P 500 technology, healthcare communication services sector indexes hit record highs.
Eli Lilly Co jumped almost 8% after the drugmaker said it would apply for the US Food Drug Administration’s accelerated approval for its experimental Alzheimer’s drug this year.
In response, Biogen Inc, which received a controversial approval for its Alzheimer’s drug aducanumab earlier this month, dropped almost 6%.
MGM Resorts International rose 2.8% after Deutsche Bank upgraded the casino operator’s stock to “buy” from “hold.” Accenture Plc gained 2% after the IT consulting firm raised its full-year revenue forecast.
Advancing issues outnumbered declining ones on the NYSE by a 2.34-to-1 ratio; on Nasdaq, a 2.19-to-1 ratio favored advancers.
The S&P 500 posted 33 new 52-week highs 1 new lows; the Nasdaq Composite recorded 96 new highs 22 new lows.