Technology shares lifted the S&P 500 and the Nasdaq to record highs on Thursday as investors grew more optimistic about a coronavirus stimulus bill, helping markets look past signs of economic strain brought on by the COVID-19 pandemic.
A Christmas tree is pictured outside the New York Stock Exchange during the coronavirus disease (COVID-19) pandemic in the Manhattan borough of New York City, New York, U.S., December 16, 2020. REUTERS/Carlo Allegri
The S&P 500 technology and consumer discretionary indexes also hit record highs, up 0.6% and 0.4%, respectively.
A surge in technology outsourcing firm Accenture gave the S&P 500 its strongest lift.
Top Republicans and Democrats grew closer to agreeing on a fresh round of aid in response to a crisis that has killed more than 304,000 Americans and thrown millions out of work.
Many investors saw the passing of new measures to support the economy as imminent after data showed the number of Americans filing first-time claims for jobless benefits unexpectedly rose last week.
That followed a reading on Wednesday that showed U.S. retail sales falling more than expected in November, as consumer spending remained constrained.
“It’s all about stimulus today and expectations of a pathway to the deal,” said Ryan Giannotto, director of research at GraniteShares in New York City.
Developments on the vaccine front were also lifting the market, with Moderna Inc awaiting U.S. approval for deploying what would be the nation’s second COVID-19 vaccine. Moderna’s stock jumped 4%.
The S&P 500 has climbed 15% in 2020, despite the economic destruction caused by the coronavirus.
The Dow Jones Industrial Average was up 0.44% at 30,285.97 points, while the S&P 500 gained 0.53% to 3,720.69.
The Nasdaq Composite added 0.68% to 12,744.90.
The Russell 2000 index of smaller companies rose 1% and also hit a record high, now up 18% year to date.
“In the very short term, I think we are a little bit over bought here,” said Randy Frederick, vice president of trading and derivatives at Charles Schwab.
He noted that best-performing sectors like technology were most at risk of a pull back, while some of the “more unloved sectors” like financials and energy were getting fresh attention as investors looked for bargains.
Google-parent Alphabet dipped 1% after a group of 38 U.S. states and territories filed an antitrust complaint accusing Google of trying to extend its search monopoly to dominate smart speakers, televisions and cars.
Accenture jumped 8% after it raised its annual sales forecast and beat quarterly revenue estimates as an extended work-from-home period boosted its digital, cloud and security services.
General Mills Inc rose 1% after it beat second-quarter profit estimates, boosted by sales of its pet foods and baking products.
Advancing issues outnumbered declining ones on the NYSE by a 1.94-to-1 ratio; on Nasdaq, a 1.92-to-1 ratio favored advancers.
The S&P 500 posted 35 new 52-week highs and no new lows; the Nasdaq Composite recorded 233 new highs and 10 new lows.