THE S&P 500 nabbed its fifth straight record closing high on Wednesday as investors ended the month and the quarter by largely shrugging off positive economic data and looking toward Friday’s highly anticipated employment report.
In the last session of 2021’s first half, the indexes were languid and range-bound with the blue-chip Dow posting gains while the Nasdaq edged lower.
The Dow Jones Industrial Average rose 210.22 points or 0.61% to 34,502.51, the S&P 500 gained 5.7 points or 0.13% to 4,297.5 and the Nasdaq Composite dropped 24.38 points or 0.17% to 14,503.95.
All three indexes posted their fifth consecutive quarterly gains with the S&P rising 8.2%, the Nasdaq advancing 9.5% and the Dow rising 4.6%. The S&P 500 registered its second-best first-half performance since 1998, rising 14.5%.
“It’s been a good quarter,” said Robert Pavlik, senior portfolio manager at Dakota Wealth in Fairfield, Connecticut. “As of last night’s close, the S&P has gained more than 14% year-to-date (YTD), topping the Dow and the Nasdaq. That indicates that the stock market is having a broad rally.”
For the month, the bellwether S&P 500 notched its fifth consecutive advance while the Dow snapped its four-month winning streak to end slightly lower. The Nasdaq also gained ground in June.
This month, investor appetite shifted away from economically sensitive cyclicals in favour of growth stocks.
“Leading sectors YTD are what you’d expect,” Pavlik added. “Energy, financials and industrials, and that speaks to an economic environment that’s in the early stages of a cycle.”
“(Investors) started the switch back to growth (stocks) after people started to buy in to (Fed Chair Jerome) Powell’s comments that focus on transitory inflation,” Pavlik added.
“Some of the reopening trades have gotten a bit long in the tooth and that’s leading people back to growth.
The private sector added 692,000 jobs in June, breezing past expectations, according to payroll processor ADP. The number is 92,000 higher than the private payroll adds economists predict from the Labour Department’s more comprehensive employment report due on Friday.
Among the 11 major sectors in the S&P, six ended the session higher, with energy enjoying the biggest percentage gain. Real estate was the day’s biggest loser.
Advancing issues outnumbered declining ones on the NYSE by a 1.35-to-1 ratio; on Nasdaq, a 1.19-to-1 ratio favoured decliners.
The S&P 500 posted 20 new 52-week highs and no new lows; the Nasdaq Composite recorded 70 new highs and 36 new lows.
Volume on US exchanges was 10.85 billion shares compared with the 11.05 billion average over the last 20 trading days. – July 1, 2021
