US stocks hit record intraday highs on Tuesday amid gains across sectors as strong earnings from top retailers underscored the strength of the US economy.
US stocks hit record intraday highs on Tuesday amid gains across sectors as strong earnings from top retailers underscored the strength of the US economy. One in every six stocks on the S&P 500 hit a new 52-week high as a rally sparked by President Donald Trump’s promise of tax reforms showed no sign of fading despite concerns around valuations. The index is trading at 19.7 times trailing 12-month earnings, above the long-term average of 17.2 times, according to Thomson Reuters Datastream. “There is no doubt in anyone’s mind that the market has become over extended and is due for a pullback,” said Quincy Krosby, market strategist at Prudential Financial in Newark, New Jersey. “That said, when you have this kind of momentum, it is very hard to sit on the sidelines.” In the one month of Trump’s presidency, the S&P 500 hit record intraday highs 10 times, gained 3.9 percent and surpassed $20 trillion in market capitalization.
Robust earnings have added to the momentum. Overall profit for S&P 500 companies is estimated to have risen 7.5 percent in the latest quarter – the biggest rise since the fourth quarter of 2014.
Wal-Mart’s shares were among the top stocks on the Dow, rising 3.2 percent after the company reported higher-than-expected U.S. sales.
Department store bellwether Macy’s and home improvement chain Home Depot rose after the companies posted profits that topped estimates.
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At 12:33 a.m. ET (1733 GMT), the Dow Jones Industrial Average was up 93.67 points, or 0.45 percent, at 20,717.72, the S&P 500 was up 11.09 points, or 0.47 percent, at 2,362.25 and the Nasdaq Composite was up 15.30 points, or 0.26 percent, at 5,853.88.
All 11 major S&P sectors were higher on Tuesday, led by a 0.98 percent gain in the energy index as oil prices rose.
Popeyes Louisiana Kitchen jumped 19 percent to $78.80 after Restaurant Brands agreed to acquire the quick-service restaurant chain for $1.8 billion.
Freeport was the biggest loser on the S&P, dropping 5.5 percent after the miner warned on Monday it could take the Indonesian government to arbitration and seek damages over a dispute that has halted operations at a copper mine.
Advancing issues outnumbered decliners on the NYSE by 1,983 to 917. On the Nasdaq, 1,539 issues rose and 1,259 fell.
The S&P 500 index showed 87 new 52-week highs and no new lows, while the Nasdaq recorded 193 new highs and 22 new lows.