Coverage: Nasdaq closes above 7,000 for first time
The Nasdaq closed above 7,000 for the first time on Tuesday as investors were optimistic that 2018 will bring more gains for the market.
Caroline Valetkevitch of Reuters had the news:
The Nasdaq, driven by gains in Apple, Facebook, Amazon and Alphabet, breached 6,000 in April of last year and closed above 5,000 in 2015 for the first time in 15 years. The technology index .SPLRCT added 1.4 percent on Tuesday, following a 37-percent surge in 2017 that made it the best-performing S&P 500 sector.
The S&P 500 also hit a record high close. Besides technology, S&P consumer discretionary, healthcare, energy and materials indexes all were up more than 1 percent on the day.
Major stock indexes closed out 2017 with their best performances since 2013. Many investors say the rally could continue this year with help from the recently approved U.S. tax overhaul that is anticipated to boost profits as well as the economy.
“We’re off to the races once again,” said Stephen Massocca, senior vice president at Wedbush Securities in San Francisco.
Marley Jay of the Associated Press reported that it was the best first day for Nasdaq since 2013:
U.S. stocks followed suit as investors snapped up shares of companies that should benefit from faster economic growth, including technology, health care and materials companies, just as they did last year. The Nasdaq composite busted through another milestone as it closed above 7,000 points.
“We’ll continue to see many of the themes from last year play out,” said Kate Warne, an investment strategist for Edward Jones.
She said the global economy should keep growing and businesses and consumers around the world will continue to spend more money. It helps that interest rates are low, and governments in areas that reduced their spending during the Great Recession are becoming more willing to spend.
The Standard & Poor’s 500 index rose 22.18 points, or 0.8 percent, to a record 2,695.79. The Dow Jones industrial average climbed 104.79 points, or 0.4 percent, to 24,824.01. The Nasdaq composite jumped 103.51 points, or 1.5 percent, to 7,006.90. The Russell 2000 index, which consists of smaller company stocks, gained 14.50 points, or 0.9 percent, to 1,550.51, also a new high.
The Nasdaq had its best opening day since 2013 as the big technology companies that dominated in 2017 got the new year off to a good start. Facebook rose $4.96, or 2.8 percent, to $181.42 and Apple climbed $3.03, or 1.8 percent, to $172.26. Chipmaker Nvidia climbed $5.85, or 3 percent, to $199.35.
Fred Imbert and Alexandra Gibbs of CNBC.com reported that stocks continued the strong run of 2017:
“This is basically an extension of what we saw in 2017,” said Peter Cardillo, chief market economist at First Standard Financial. “With economic data being strong, investors are betting that economic growth will translate into strong earnings growth.”
Equities had a banner year in 2017, with the three major indexes notching all-time highs. The S&P 500, Dow and Nasdaq gained 19.4 percent, 25.1 percent and 28.2 percent, respectively.
Stocks got a boost last year from strong growth in corporate earnings, solid economic data and as expectations of lower corporate taxes.
Last month, President Donald Trump signed a bill that slashed the corporate tax rate in the U.S. to 21 percent from 35 percent. Several companies announced they were giving bonuses to their employees after Trump signed the bill.