Wall Street Ascends To New Highs As S&P Breaks 1,700

Michael Teague  |

The Dow Jones Industrial Average and the Standard & Poor’s 500 closed on new all-time highs on Monday as stocks rode the crest of positive economic data and relative calm about the future of the Fed’s support of the economy.

The S&P 500 closed the day up 1.25 percent to 1,706.87, breaking 1,700 for the first time, while the Dow ended 0.83 percent higher at 15,628.02, and the NASDAQ advanced 1.36 percent to end trading at 3,675.74.

Manufacturing purchasing managers index (PMI) reports for the month of July flooded in from around the world, painting a substantially less dismal picture of global economic conditions, with relatively slower economic growth in Asia offset by a much better outlook for the Eurozone. Bolstered by positive manufacturing reports out of Greece, France, Italy, and Germany, the Eurozone composite index climbed into growth, breaking above 50 basis-points at 50.3 for the first time in two years.

In the US, the Institute for Supply Management’s monthly report showed the index leaping over expectations at 55.4, well ahead of the 50.9 result from June, and 2.4 basis points ahead of expectations.

And even though June’s construction spending dropped 0.6 percent, versus expectations of a 0.4 percent gain, initial weekly jobless claims dropped to their lowest level since the beginning of 2008 at 326,000, almost 20,000 less than expected.

Basic materials and tech stocks gave support to the S&P 500, with substantial gains for independent oil and gas companies Pioneer Natural Resources ($PXD) and Chesapeake Energy Corporation ($CHK), as well as Sprint Nextel (S) and Teradata Corporation (TDC) .

On the Dow, the world’s largest oil company Exxon Mobil (XOM) led on the downside with a loss of over 1 percent after releasing a disappointing earnings report that missed big on earnings-per-share. Big oil had a bad terrible day overall with Royal Dutch Shell ($RDS-A) dropping over 5 percent after releasing its own dismal earnings report. American Express (AXP) and Bank of America (BAC) led the index higher.

Tech stocks also pushed the NASDAQ higher, with high-volume gains for Facebook (FB) , Dell (DELL) , and Micron Technology (MU) among others.

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