WALL Street’s main indexes posted record closing highs on Monday after President Donald Trump said an initial US-China trade pact would be signed soon, while Boeing gave the Dow a big boost after the planemaker ousted its CEO.
Boeing Co shares, which have a particularly big influence on the Dow Jones Industrial Average, gained 2.9% and also lifted the S&P 500 industrials sector. CEO Dennis Muilenburg’s exit followed a prolonged crisis in which Boeing halted production of its best-selling 737 MAX jetliner following two fatal crashes.
Trump over the weekend said the US and China would “very shortly” sign their so-called Phase One trade pact, which was announced earlier this month and has helped propel the US stock market to records.
The S&P 500 notched a record closing high for a third straight session on Monday and hit an intraday all-time high for an eighth straight session. The Nasdaq closed at a record high for an eighth straight session.
“The stream of news has continued to favour the bullish bias, so there really hasn’t been a reason for people to sell, and you’ve got that fear of missing out that has kind of kicked in the last month and a half,” said Chuck Carlson, CEO at Horizon Investment Services in Hammond, Indiana.
Additionally, China will lower tariffs on products ranging from frozen pork and avocado to some types of semiconductors next year.
“The key for businesses is that tariffs may not escalate further from this point,” said Mona Mahajan, US investment strategist with Allianz Global Investors in New York. “That’s critical for business confidence and the overall backdrop in which they’re operating.”
The Dow Jones Industrial Average rose 96.44 points, or 0.34%, to 28,551.53, the S&P 500 gained 2.79 points, or 0.09%, to 3,224.01 and the Nasdaq Composite added 20.69 points, or 0.23%, to 8,945.65.
Energy and industrials were the best-performing S&P 500 sectors, while utilities lagged the most.
Trading volume is expected to be sparse in a trading week shortened by the Christmas holiday. On Monday, roughly 5.9 billion shares changed hands on US exchanges, well below the 7.2 billion daily average over the last 20 sessions.
The benchmark S&P 500 has climbed more than 28% so far in 2019, helped by improving investor sentiment over trade relations, interest rate cuts by the Federal Reserve and optimism the economy will avoid a severe downturn at least in the near term.
Data on Monday showed new orders for US-made capital goods barely rose in November and shipments fell, suggesting business investment will probably remain a drag on economic growth in the fourth quarter. – Dec 24, 2019, Reuters
