The Dow Jones industrial average and S&P 500 ended at record highs on Monday, helped by a rally in Apple as well as tepid economic data suggesting the Federal Reserve may wait to boost interest rates.
Canadian markets were closed for Victoria Day.
The S&P 500 racked up its third straight all-time high close, gaining 6.47 points, or 0.3 per cent, to end at 2,129.2 points. The Dow rose 26.32 points, or 0.14 percent, to end at 18,298.88, beating its previous record close of 18,288.63 from March 2.
U.S. homebuilder sentiment fell in May although most builders view market conditions as favorable, the National Association of Home Builders said on Monday.
Slowing economic expansion in recent months, stemming partly from a stronger dollar and sluggish wage growth, has led many investors to push back expectations about once the Fed will start raising rates of interest for the first time since 2006.
\”It\’s becoming more of the collective believed that the Fed can wait, since you really don\’t see any blistering growth,\” said Kurt Brunner, a portfolio manager at Swarthmore Group in Philadelphia.
Apple\’s shares rose 1.10 per cent to US$130.19 after Carl Icahn, among the iPhone maker\’s top 10 shareholders, said the stock was \”still dramatically undervalued\” which should be trading at US$240.
The Nasdaq Composite added 30.15 points, or 0.6 percent, to end at 5,078.44.
Apple\’s rise was the largest factor for that rise in the three major indexes.
Seven from the 10 major S&P 500 sectors were higher, using the financial index\’s 0.56 percent gain leading the way.
Sentiment got a boost from talk of mergers and acquisitions.
Altera rose 5.65 percent to US$46.93 following the New York Post reported the organization had resumed talks with Intel on the possible deal. Intel rose 1.24 per cent.
Endo International fell 5.37 percent to US$80.77 after the generic drugmaker said hello would buy privately owned Par Pharmaceutical from TPG Capital in a US$8.05 billion deal.
Alibaba fell 1.53 per cent after a number of luxury goods makers sued the organization on Friday, contending that the Chinese e-commerce giant knowingly made it possible for counterfeiters to sell their products throughout the world.
With Monday\’s advances, the Dow is up 2.7 percent year to date, the S&P 500 is 3.4 percent higher and also the Nasdaq is 7.2 per cent stronger.
The S&P now trades at 17 times expected earnings, expensive compared to its 10-year median of 15.
Relatively light trading volume suggests recent gains may not be resilient, especially as the market approaches summertime when many on Wall Street takes time off, said Brunner.
About 5.3 billion shares altered on U.S. exchanges, underneath the 6.4 billion average this month, according to BATS Global Markets.
During the session, advancing issues outnumbered declining ones on the NYSE by 1,577 to at least one,428, for a 1.10-to-1 ratio on the upside; on the Nasdaq, 1,719 issues rose and 1,014 fell for any 1.70-to-1 ratio favoring advancers.
The S&P 500 posted 34 new 52-week highs and 2 new lows; the Nasdaq Composite recorded 111 new highs and 39 new lows.
? Thomson Reuters 2015