Wall Street's broadest stock index is just one session short of its 3452-day record set in March 2000.
Wall Street is poised to enter its longest ever bull run, with the S&P 500 just one session short of its 3452-day record set in March 2000.
That run ended in the dot-com bust while the post global financial crisis bull market that started on March 9, 2009, shows no immediate sign of slackening.
However, the current rally, which started at 666, has been more modest in its gains. Shares rose 417% in the previous record run, well above the latest 322% advance.
The S&P 500 closed up 0.2% at 2863.96, below its January record close of 2871, though it traded at this level earlier in the session.
For the past nearly seven months it has traded sideways. It is in its longest streak without notching a record close since the 285 trading days between May 22, 2015 and July 8, 2016,
Four companies – Amazon, Microsoft, Apple and Netflix – account for 40% of the S&P 500’s nearly 7% gain for the year.
The broad index is now up 7.4% for the year – trailing the tech-heavy Nasdaq Composite’s 14% gain – but is still well ahead of peer indexes in the UK, Japan, Hong Kong and Germany.
Meanwhile, the Dow Jones Industrial Average advanced 63.60 points, or 0.25%, to 25,822.29. This is the Dow’s third-longest rally after bull markets that ended in 1961 and 1929,
The Nasdaq Composite gained 0.8% to 7859.69.
'Resilient' market
Wall Street has been “amazingly resilient,” says Wells Fargo Private Bank chief investment officer Erik Davidson, adding that he feels valuations don’t look too expensive.
He says the fact that investors also appear to be cautious is reassuring and a sign of the market’s health.
Shares of energy and consumer-discretionary companies rallied. The S&P 500’s energy sector was up 1.1%, following US crude oil’s 1.4% rise, while the consumer-discretionary sector added 1.1%.
Oil settled at $US67.35 a barrel in New York and Brent, the global benchmark, climbed 0.6% to $US72.63 a barrel.
The utility, real estate and consumer-staples sectors, which investors consider bondlike because of their dividend payouts, all fell.
Shares generally have been boosted by a buoyant labour market, strong consumer spending and extended corporate earnings growth. Offsetting this has been a gloomier global environment, fuelled by slowing China growth and President Trump’s trade war.
The US market reflects status as a haven for investors, who have sought stable growth as markets from Turkey to Russia to China have notched steep declines.
US stocks favoured
Global fund managers’ allocation to US stocks rose this month to the highest level since January 2015, Bank of America Merrill Lynch’s August fund manager survey shows.
In addition, a net 67% of investors surveyed say the US has the most favourable outlook for corporate profits – the highest share since the survey began asking the question 17 years ago.
“The economy looks good and consumers feel confident, which is supporting the market,” CFRA Research investment strategist Lindsey Bell says.
Corporate earnings continue to drive swings in individual stocks.
High-end homebuilder Toll Brothers' shares rose 13.6% after profit rose 30% in its latest quarter. Toll has benefitted from low housing inventory and strong activity among affluent consumers willing to pay a premium.
TJX, the owner of discount-clothing chain TJ Maxx, rose 4.5% after it raised guidance for the full year. It says foot traffic rose for the 16th consecutive quarter.
Shares of health-services company Premier rose 14% after the its earnings beat estimates.
Bonds weaken
US government bonds weakened. The yield on the 10-year Treasury note rose to 2.847% from 2.823% on Monday.
Even though the yield curve has continued to flatten this year, investors shouldn’t necessarily interpret that as a signal to step away from stocks, Edward Jones investment strategist Kate Warne says.
“Rebalancing is important, but getting out of stocks is not the right move,” she says, adding that she believes stocks still have room to rise.
The Stoxx Europe added 0.2%. France’s CAC 40 rose 0.5% and Germany’s DAX was up 0.4%, while the UK’s FTSE 100 fell 0.3%.
In Asia, Japan’s Nikkei Stock Average finished up 0.1%, Hong Kong’s Hang Seng was up 0.6% and the Shanghai Composite surged 1.3%.
