Phone and bank stocks push indexes higher; Dow reaches new record
Stocks posted slight gains Tuesday, sending the Dow Jones industrial average to another record, helped by shares of telecommunications companies such as Verizon, Sprint and AT&T.
Small-company and bank stocks also rose as investors continued to speculate that U.S. economic growth will pick up under the incoming Trump administration.
The Dow Jones industrial average rose 35.54 points, or 0.2%, to 19,251.78, a record-high close. The Standard & Poor’s 500 index rose 7.52 points, or 0.3%, to 2,212.23 and the Nasdaq composite rose 24.11 points, or 0.5%, to 5,333.
Telecommunications stocks were among the biggest gainers, helped by lots of company-specific news. Dow member Verizon climbed 1% to $50.36 and AT&T rose 2% to $39.35. Overall, the telecom sector of the S&P 500 rose 1.5%.
AT&T rose after reports that its newly launched DirectTV Now service was attracting more subscribers than anticipated. Verizon rose as the company sold a group of data centers for $3.6 billion.
Separately, Sprint rose 1.5% to $8.17 and T-Mobile climbed 1.8% to $55.99 after President-elect Donald Trump said that Japanese company SoftBank, which owns the majority of Sprint, would invest $50 billion in the U.S. to create 50,000 jobs. However, it’s not clear if Softbank’s announcement is new. T-Mobile shares rose on speculation that it could be acquired in a deregulatory Trump White House, possibly by SoftBank.
Read more: Trump takes credit for SoftBank CEO’s pledge to invest $50 billion in the U.S. »
Bank stocks also continued to perform well, as they have since the election. The financial services sector of the S&P 500 closed up 1%, far more than the broader market. The Russell 2000 index, which is made up of mostly smaller companies, rose 1.1% to a new record as well.
Boeing’s stock dropped briefly after Trump said he believed that the U.S. government should cancel an anticipated order for new Air Force One planes, claiming the project is too expensive. The Air Force has not contracted out the new Air Force One planes; however, Boeing does have a $170-million viability contract with the Air Force to determine the capabilities of the next version of Air Force One.
Boeing was down as much as 1% in midsession trading but closed mostly unchanged at $152.24.
A rally in oil prices petered out after four days of gains driven by OPEC’s deal to cut production next year. Benchmark U.S. crude fell 86 cents to $50.93 in New York. Brent crude, the international standard, dropped $1.01 to $53.93 a barrel in London. Although oil prices were solidly lower, energy companies were trading mostly flat to only slightly lower.
Heating oil fell 2 cents to $1.64 a gallon, wholesale gasoline fell 2 cents to $1.54 a gallon and natural gas fell 2 cents to $3.64 per 1,000 cubic feet.
In other company-specific news, Chipotle Mexican Grill dropped 7.5% to $366.37 after the company’s CEO said that he was “nervous” about hitting full-year forecasts and that the company’s turnaround is going slower than expected. Chipotle has struggled since an E. coli outbreak last year.
In Europe, Italy’s stock market jumped 4.2%, a day after slipping in the wake of the failure of a constitutional referendum that forced the resignation of that country’s premier. France’s CAC 40 advanced 1.3%, Britain’s FTSE 100 went up 0.5% and Germany’s DAX rose 0.8%.
U.S. government bond prices rose slightly. The yield on the 10-year Treasury note fell to 2.39% from 2.40% late Monday.
In currencies, the euro fell to $1.0715 from $1.077, and the dollar rose to 114.05 yen from 113.75 yen.
Gold fell $6.40 to $1,170.10 an ounce, silver fell 9 cents to $16.81 an ounce and copper fell 2 cents to $2.68 a pound.
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UPDATES:
3:40 p.m.: This article was updated with closing prices, additional market information and context.
7:50 a.m.: This article was updated with more market information and context.
This article was originally published at 7 a.m.
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