Wall Street closes higher as momentum stocks push S&P 500, Nasdaq to new highs

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By Stephen Culp © Reuters/MIKE SEGAR A man walks a dog in the shade past the New York Stock Exchange (NYSE) during hot weather in New York NEW YORK (Reuters) – U.S. stocks surged on Wednesday, pushing the S&P 500 to its fourth straight record closing high, as investors stayed […]

By Stephen Culp



A man walks a dog in the shade past the New York Stock Exchange (NYSE) during hot weather in New York


© Reuters/MIKE SEGAR
A man walks a dog in the shade past the New York Stock Exchange (NYSE) during hot weather in New York

NEW YORK (Reuters) – U.S. stocks surged on Wednesday, pushing the S&P 500 to its fourth straight record closing high, as investors stayed focused on large-cap momentum stocks that have outperformed since the onset of the coronavirus pandemic.

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The Nasdaq also set an all-time closing high, its 39th year-to-date, compared with a total of 31 reached in all of 2019.

The Dow, which remains 4.1% below its pre-COVID record, and 0.7% off showing a year-to-date gain, posted a more modest advance.

The MSCI world equity index surged past its February high to reach a record peak.

Salesforce.com, a software-as-a-service provider and soon-to-be Dow component, saw its shares soar 26.0% following its beat-and-raise earnings report.

Netflix Inc shares had their best day in over three years, jumping 11.6%. The stay-at-home favorite has surged 69.2% since the final closing bell of 2019.

Facebook Inc rose 8.2% giving the S&P 500 its biggest boost.

“Your three highest sectors are all the mega-cap tech and tech-related stocks,” said Joseph Sroka, chief investment officer at NovaPoint in Atlanta. “So that notion of large-cap tech leading the market is in play today.”

“There’s this confidence that regardless of what happens with COVID, these companies have proven that they’re open for business.”

Energy was the biggest percentage loser among S&P 500 sectors, dropping 2.2% as Hurricane Laura bore down on the Texas-Louisiana coastline, posing the largest threat to U.S. energy assets since 2005’s Hurricane Katrina. The coming storm, now a Category 4, prompted crude producers and refiners to shut down their facilities.

Commercial air carrier stocks lost altitude, with the S&P 1500 Airline index dipping 1.8% even after the White House announced President Donald Trump was weighing an executive action to avoid massive layoffs in the sector.

The U.S. Federal Reserve is expected to unveil a new framework intended to soften the central bank’s inflation stance, which Chairman Jerome Powell is expected to address during his remarks on Thursday as part of the Kansas City Fed’s virtual Jackson Hole symposium.

The Dow Jones Industrial Average rose 83.48 points, or 0.3%, to 28,331.92, the S&P 500 gained 35.11 points, or 1.02%, to 3,478.73 and the Nasdaq Composite added 198.59 points, or 1.73%, to 11,665.06.

Communications services led the 11 major sectors in the S&P in percentage gains.

Hewlett Packard Enterprise Co rose 3.6% after its full-year profit outlook beat expectations, while tax software firm Intuit Inc advanced 1.8% on a 17% rise in quarterly revenue.

Apparel retailer Nordstrom Inc tumbled 5.5% following its bigger-than-expected quarterly losses after being forced by mandated lockdowns to shutter its stores.

Declining issues outnumbered advancing ones on the NYSE by a 1.29-to-1 ratio; on Nasdaq, a 1.34-to-1 ratio favored decliners.

The S&P 500 posted 38 new 52-week highs and no new lows; the Nasdaq Composite recorded 88 new highs and 8 new lows.

Volume on U.S. exchanges was 8.55 billion shares, compared with the 9.42 billion average over the last 20 trading days.

(Reporting by Stephen Culp; Editing by Cynthia Osterman)

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