S&P 500, Nasdaq Close Week on New Records, Beating Economic Reports
The S&P 500 and Nasdaq closed at record highs on Friday, as data pointed to some pockets of strength in the U.S. economy.
U.S. business activity snapped back to the highest since early 2019 in August, according to IHS Markit surveys, as companies in both manufacturing and services sectors saw a resurgence in new orders.
Another report showed U.S. home sales rose at a record pace for a second straight month in July and home prices hit all-time highs.
The unexpectedly sharp increases in Markit’s indexes extend a pattern of choppy U.S. economic data this week – including weekly jobless claims – that paint a picture of a fitful recovery from the COVID-19 recession.
“It’s not surprising to see a pickup in manufacturing as the economy has started to reopen, even though pockets of the country have pulled back on their reopenings,” said Lindsey Bell, chief investment strategist at Ally Invest. “It’s an encouraging sign and it supports the upside we have seen in the markets.”
Bets that technology-focused companies including Apple Inc and Amazon.com will emerge stronger from the pandemic have set the S&P 500 and the Nasdaq on track to close out the week higher.
On Tuesday, the S&P 500 recouped all its losses caused by the coronavirus-driven slump and joined the Nasdaq in scaling new peaks. The Dow is still 6% below its all-time high in February.
Investors also worry about a stalemate in talks between House Democrats and the White House over the next coronavirus aid bill as about 28 million Americans continued to collect unemployment checks.
Unofficially, the Dow Jones Industrial Average rose 191.05 points, or 0.69%, to 27,930.78, the S&P 500 gained 11.73 points, or 0.35%, to 3,397.24 and the Nasdaq Composite added 46.85 points, or 0.42%, to 11,311.80.
The S&P 500 information technology and industrial indexes were among the strongest.
Apple Inc rose 4% as its market value continued to swell after the most valuable publicly listed company in the world crossed the $2 trillion milestone this week.
Tesla jumped again after surging past the $2,000 a share mark on Thursday for the first time, extending its rally ahead of an upcoming share split.
Deere & Co rose after the world’s largest farm equipment maker raised its full-year earnings forecast.