Archive

Dow Jones, S&P end at highs as stocks continue rebound | TribLIVE.com
U.S./World

Dow Jones, S&P end at highs as stocks continue rebound

The Associated Press

NEW YORK — For stocks on Monday, the path of least resistance was up.

The Standard & Poor’s 500 index and the Dow Jones industrial average edged up to record highs on a day that was light on economic news and company releases.

Toll Brothers, a builder of luxury homes, rose after reporting its revenue surged in the most recent reporting period. Dean Foods jumped after the dairy company reported a much smaller loss than expected for its third quarter and projected a profit for the fourth quarter.

Stocks are trading at record levels, having rebounded from a sharp slump at the beginning of October. Improving company earnings and signs that the economy remains solid, despite growth lagging overseas, are encouraging stock investors.

“What is there to not like?” said Karyn Cavanaugh, a senior market strategist at Voya Investment Management. “As we head into the end of the year, earnings projections for 2015 are looking strong.”

The Standard & Poor’s 500 index rose 6.34 points, or 0.3 percent, to 2,038.26. The Dow Jones industrial average gained 39.81 points, or 0.2 percent, to 17,613.74. The Nasdaq composite climbed 19.08 points, or 0.4 percent, to 4,651.62.

About 90 percent of companies in the S&P 500 have reported their third-quarter results, and their earnings are projected to rise at an average rate of 8.9 percent for the period, according to S&P Capital IQ data. That compares with growth of 4.9 percent in the same period a year ago and 10.4 percent in the second quarter.

Earnings are forecast to keep growing at a broadly similar pace in coming quarters.

The economy is also providing companies with a sound base. Reports last week showed that manufacturing continued to expand and hiring remained healthy.

On Monday, health care stocks rose the most of the ten sectors in the index. They climbed almost 1 percent, extending their gains for the year to 22 percent.

Home builders rose after Toll Brothers said that its revenue rose 29 percent in the most recent quarter and average sales prices rose. Toll Brother’s stock climbed 73 cents, or 2.3 percent, to $32.95.

Other companies in the industry, including Lennar Corp., PulteGroup and D.R. Horton also rose.

Cable companies were among the day’s losers after President Barack Obama said regulators should reclassify the Internet as a public utility.

The president also said that Internet providers shouldn’t be allowed to cut deals with online services like Netflix, Amazon or YouTube to prioritize their content. In a statement released by the White House Monday, the president called for an “explicit ban” on such deals.

Time Warner Cable fell $7.10, or 4.9 percent, to $136.50. Comcast fell $2.20, or 4 percent, to $52.95.

Energy companies also resumed their slide as the price of oil dropped again.

The price of oil fell Monday on expectations of continued high OPEC output after the Kuwaiti oil minister predicted no production cut this month and an important field in Libya appeared to be coming back online.

Benchmark U.S. crude fell $1.25 to close at $77.40 a barrel on the New York Mercantile Exchange. Brent crude, a benchmark for international oils used by many U.S. refineries, fell $1.05 to close at $82.34 on the ICE Futures exchange in London. That’s the lowest close for Brent since October 2010.

Stocks, though no longer cheap, are still attractive because of lower returns elsewhere, said Bill Stone, the chief investment strategist for PNC Wealth Management. Bond yields have fallen this year, and rates on cash deposits remain close to zero.

“My baseline is that stocks will continue to chug along,” Stone said.

On Monday, bond prices fell, pushing yields higher, though they remain lower than they were at the start of the year.

The yield on the 10-year Treasury edged up to 2.35 percent from 2.30 percent. The yield was at 3 percent at the start of the year.

Later in the week investors will be taking stock of retail company earnings to gain insight into how much American shoppers are spending ahead of the holiday season. Macy’s, Nordstrom and Wal-Mart will report their earnings. The government will also release its retail sales data for October on Friday.

The dollar edged higher against the Japanese yen, climbing 0.3 percent to 114.89 yen. Against the euro, the U.S. currency was little changed at $1.2424.

In metals trading, gold fell for the eighth time in nine days, sliding $10, or 0.9 percent, to $1,159.80 an ounce. Silver dropped 4.3 cents, or 0.3 percent, to $15.67 an ounce. Copper fell 1.9 cents, or 0.6 percent, to $3.02 a pound.

In other energy futures trading on the NYMEX:

— Wholesale gasoline fell 3.4 cents to close at $2.109 a gallon.

— Heating oil fell 3.1 cents to close at $2.469 a gallon.

— Natural gas fell 15.7 cents to close at $4.255 per 1,000 cubic feet.


TribLIVE commenting policy

You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.

We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.

While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.

We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers

We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.

We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.

We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.

We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.