Best Buy tumbles after results, DSW risesComment on this story
New York - US stocks edged higher on Tuesday to lift the S&P 500 just a hair above the 2,000 mark, its first close above that milestone, after data that pointed to a brighter future for the economy.
Energy shares, which closely track the pace of growth, led the day's gain. The S&P energy index rose 0.5 percent and ranked as the best performer of the 10 major S&P sectors.
The S&P 500 hit an intraday high of 2,005.04, climbing above the 2,000 mark for the second straight day. On Monday, though, the benchmark could not hold on to that mark and ended at 1,997.92. With Tuesday's move, both the Dow and the S&P 500 have risen in 10 of the past 13 sessions, while the Nasdaq is up for 11 of the past 13 sessions.
However, much of the market's recent gains have come on low volume, suggesting that many traders may be reluctant to jump in at current levels.
“We will have to wait and see. Volume this week is very light; we have a lot of people still on vacation. But economically and fundamentally, it is a good picture,” said Jeff Kravetz, regional investment director at US Bank Wealth Management in Phoenix.
US consumer confidence rose more than expected in August, climbing to its highest since October 2007, according to the Conference Board, an industry group. The Commerce Department reported that US durable goods orders jumped 22.6 percent in July, the biggest gain on record, though the number was skewed by strong international demand for aircraft.
“Even though that (durables) number is lopsided and kind of skews the picture, when you have more aircraft orders and auto sales, in the long run, those are positives. That shows the economy is recovering and there are some good prospects,” Kravetz said.
The market's trend higher is still seen as intact. The S&P 500's price-to-earnings ratio is within historical norms, leading many analysts to believe stocks are not overvalued. Nonetheless, further pronounced gains may be a challenge because of potential headwinds such as a reduction in Federal Reserve stimulus and a simmering conflict between Ukraine and Russia.
The Dow Jones industrial average rose 29.83 points or 0.17 percent, to end at 17,106.70. The S&P 500 gained 2.10 points or 0.11 percent, to close at 2,000.02, a record high. The Nasdaq Composite added 13.29 points or 0.29 percent, to finish at 4,570.64.
The Dow industrials had touched a record intraday high of 17,153.80 during Tuesday's session.
Best Buy Co Inc shares slid 6.9 percent to $29.80 after the electronics retailer reported second-quarter revenue that missed expectations and forecast a drop in same-store sales in the second half of the year. But DSW jumped 9.2 percent to $30.99 after the shoe and accessory retailer's adjusted quarterly earnings topped forecasts.
Digital Ally extended its meteoric rise, surging another 14.2 percent to $14.28 on heavy volume. The recent fatal police shooting of an unarmed black teenager in Missouri has fuelled interest in the company's wearable camera, and the stock's price has nearly quadrupled this month alone.
Amazon.com agreed late on Monday to buy live-streaming gaming network Twitch Interactive for about $970 million in cash. Amazon's stock rose 2.3 percent to $341.83 and gave the biggest boost to the Nasdaq 100 index.
Volume was light, with about 4.25 billion shares traded on US exchanges, well below the 5.44 billion average so far this month, according to data from BATS Global Markets.
Advancing stocks outnumbered declining ones by a ratio of about 2 to 1 on both the New York Stock Exchange and the Nasdaq. - Reuters