dow jones 21479 plus 129
S&P 5002429 plus 5.6
DAX 12475 plus 150
FTSE 7377 plus 64
OIL 47.01 plus 0.97
GOLD1222 minus 18.57
AUD 0.7659
SPI Futures plus 32
U.S. stocks on Monday closed the first day of trading in July and the second half of 2017 in positive territory—though off the day’s best levels—on the back of a rally in energy and financials, but tech shares lagged behind.
Gains accelerated in an abbreviated session ahead of the Fourth of July holiday on Tuesday, after an upbeat report on manufacturing.
Sharp advances in Goldman Sachs Group Inc. GS, +2.42%J.P. Morgan Chase & Co. JPM, +2.04% and Chevron Corp. CVX, +1.89% were the main contributors to the Dow’s Monday upswing.
The S&P 500 index SPX, +0.23% rose 5.61 points, or 0.2%, at 2,429.02, led by 2% gain in energy and a 1.3% rise in financial shares, but limited by a 0.9% slump in tech.
Meanwhile, the Dow Jones Transportation Average DJT, +0.79% closed at a record at 9.639.63, marking the indicator’s first all-time high since March 1. The small-cap Russell 2000 index RUT, +0.80% also notched a record close at 1,426.68. Some market experts consider records in the transports benchmark and the Dow industrials at the same time, along with records in small-cap shares, as a bullish sign of Wall Street health.
Lagging behind the benchmarks, however, was the Nasdaq Composite Index COMP, -0.49% down 30.36 points, or 0.5%, to end at 6,110.06. The tech sector has been among the more volatile segments of the market after a number of popular stocks, including Amazon.com Inc. AMZN, -1.48% in early June, hit records, raising concerns that valuations were getting rich.
“I think what we have here is an environment that is reasonably good,” said John Manley, chief equity strategist at Wells Fargo Funds Management. Manley said the investment atmosphere continues to be a good one and that earnings may further bolster confidence, if results are better than expected.
“The environment is not a bad environment and I look around and say valuations are high but they are kind of on the low end of high, but if nothing unexpectedly bad happens, it probably is not going to matter,” said Manley.
David O’Malley, CEO of Penn Mutual Asset Management, also maintains a bullish outlook. He said recent reflation in bonds, with the 10-year Treasury offering a yield of 2.34%, compared with 2.22% at the same time last week, is helping the overall market because higher yields are a positive to financials, which are the linchpin to economic health. “If the banks start outperforming that could really deliver a lift to the market,” he said.
The New York Stock Exchange ended trading at 1 p.m. Eastern on Monday, while government-bond markets wrapped up at 2 p.m.
Economic news: On the data front, ISM’s manufacturing index rose to 57.8 in June, compared with 54.9 in the prior month, marking its highest level since 2014. A reading of 50 indicates expansion. A separate report from IHS Markit showed manufacturing PMI falling to 52.0 in June from 52.7. Economists polled by MarketWatch had expected a reading of 55.5% for the ISM gauge.
Meanwhile, May construction spending was flat, compared with a reading for April that was lifted by the Commerce Department.
In other data, vehicle sales slumped in June as prices increased
