US: Dow, S&P 500 again end at records amid improved American outlook

[NEW YORK] The Dow and S&P 500 again closed at records on Monday, as Wall Street traders continued to bet Covid-19 vaccines and government stimulus would heal the US economy.

The benchmark Dow Jones Industrial Average climbed 0.5 per cent to end the day at 32,953.46, while the broad-based S&P 500 gained 0.7 per cent to finish at 3,968.94 - the second day in a row the two indices closed at all-time highs.

The tech-rich Nasdaq Composite Index, which has seen significant volatility in recent weeks as inflation fears kept traders away from riskier tech stocks, gained 1.1 per cent to finish at 13,459.71.

"You still have that rotation from new economy stocks into the old economy stocks," said Peter Cardillo of Spartan Capital Securities.

However, the sell-off in tech appears to have found its limits, he said, pointing to Apple's 2.5 per cent rise and Cisco's 1.2 per cent gain, even as Amazon and Microsoft closed lower.

"It looks as it's bottomed out, but I don't think the rotation is totally over with," he said.

But lingering inflation fears that manifested themselves in rising bond yields took some of the momentum out of Wall Street indices, which have been boosted over the past year by the Federal Reserve's ultra-easy lending policies and massive government stimulus spending.

Markets are awaiting the results of a US$1.9 trillion stimulus package President Joe Biden signed last week, as well as the two-day Fed meeting beginning on Tuesday in which central bankers will almost certainly keep interest rates at zero but may address the inflation concerns.

Gilead finished 2.5 per cent higher and Merck 2.2 rose per cent after the two companies announced they were collaborating on a drug to treat HIV that could be taken less often than the daily medications currently in use.

AFP