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US: Wall Street ends up; defence, tech stocks a boost
[NEW YORK] US stocks rose on Monday, boosted by technology shares and by defence companies, which gained after the United States and Saudi Arabia signed a multi-billion dollar arms deal.
Shares of General Dynamics, Raytheon, and Lockheed Martin all hit record highs early on but ended off those levels, with gains of between 0.6 per cent and 1.6 per cent. Boeing gave the Dow its biggest boost, ending up 1.6 per cent at US$183.67.
The S&P industrials index rose 0.7 per cent and the S&P 500 posted a third straight day of gains, further recovering from last week's selloff that was tied to worries about the outlook for US President Donald Trump's domestic agenda.
Mr Trump visited Saudi Arabia over the weekend and sealed US$110 billion in deals. Riyadh will buy US arms to help it counter Iran, with options running as high as US$350 billion over 10 years.
It was his first foreign trip since taking office and one the White House hopes will shift the focus away from domestic controversies such as his firing of the former Federal Bureau of Investigation chief and investigations into his administration's possible links to Russia.
"For investors that were concerned about that, this successful trip he's had has kind of put those concerns on the back-burner," said Bucky Hellwig, senior vice-president at BB&T Wealth Management in Birmingham, Alabama.
"There's still a lot of money on the sidelines. When the market goes down, many investors view it as an opportunity to buy the dip."
While every sector but energy ended higher on the day, tech shares were the day's best performers, with Amazon, Microsoft and Apple among the biggest drivers in the S&P 500 and the Nasdaq.
The Dow Jones Industrial Average closed up 89.99 points, or 0.43 per cent, to 20,894.83, the S&P 500 gained 12.29 points, or 0.52 per cent, to 2,394.02 and the Nasdaq Composite added 49.92 points, or 0.82 per cent, to 6,133.62.
Volatility eased as stocks continued their recovery from last week.
The CBOE Volatility Index, the most widely followed barometer of expected near-term stock market volatility, has given up nearly all its gains from last week. It fell more than a point on Monday to end at 10.93.
A much stronger-than-expected earnings season has also helped investor sentiment. With results in from nearly all of the S&P 500 names, year-over-year first-quarter growth is now estimated at 15.3 per cent, Thomson Reuters data showed.
"There's fundamental support underlying the market from that," Mr Hellwig said.
Ford was up 2.1 per cent at US$11.10 after the automaker named James Hackett as chief executive, responding to investors' growing unease about its stock price and prospects.
Advancing issues outnumbered declining ones on the NYSE by a 2.17-to-1 ratio; on Nasdaq, a 1.95-to-1 ratio favoured advancers.
The S&P 500 posted 45 new 52-week highs and three new lows; the Nasdaq Composite recorded 102 new highs and 60 new lows.
About 5.9 billion shares changed hands on US exchanges, below the 6.9 billion daily average for the past 20 trading days, according to Thomson Reuters data.