MARKET SNAPSHOT: Dow Rises Along With The Rest Of The Stock Market, But McDonald's Eats Into Rally
By Mark DeCambre and Barbara Kollmeyer, MarketWatch
Eyes on Wall Street are on Apple Inc.'s iPhone product update
U.S. stock indexes on Tuesday traded modestly higher, but gains were capped by declines in technology, health-care and consumer-staples stocks after a brisk, broad-market runup in the previous session.
The S&P 500 set a fresh all-time, intraday high, marked by a resurgence in buying on Wall Street, though some of that enthusiasm has cooled in late-morning trade. Investors also awaited a key product debut by Apple.
The Dow Jones Industrial Average rose 60 points, or 0.3%, 22,118, but its gains were being limited by a sharp decline in shares of McDonald's Corp. (>> McDonald's Corporation), which was seeing its stock on track for the worst one-day decline since July 26, 2016, according to FactSet data.
The S&P 500 added 3 points, or 0.1%, to 2,491, marking a new intraday day high previously at 2,490.87, led by a second straight day of gains for financials as the yield of the 10-year Treasury note at 2.16%, compared with around 2.05% late last week, continued to climb, supporting the business models of lenders. Meanwhile, health care, real-estate, and utilities were the worst performing sectors, trading in the red.
The Nasdaq Composite Index , meanwhile, was flat at 6,434, after trading in record territory earlier in the session.
Robert Pavlik, chief market strategist at Boston Private Wealth, said recent moves are a combination of the unwind of the fear trade, helping lift rates and the banking sector in tandem, typically a bellwether for the rest of the economy. He argued said the market that has broadly offered signs that it is growing at a healthy, if not robust, pace, which should be taken as a bullish sign.
"Today's movement is a [further] unwinding of the fear trade," Pavlik said. He has maintained a fairly rosy outlook for the S&P 500 with a yearend forecast at 2,535, about 2% above current levels.
"There will be some more volatility before the month is over but I am not letting that bother me. I am seeing an earnings environment that is supportive at these levels but we will likely get these periods where people ar worried abut valuations," he said.
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Tuesday's moves come after the S&P 500 and the Dow industrials logged their biggest one-day percentage gains in months. The S&P 500 finished up 1.1% to reach an all-time high of 2,488.11, while the Dow retook a key level, closing up 1.2% at 22,058.37.
At the same time, the Nasdaq climbed 1.1%. Stocks rallied after Hurricane Irma caused less damage than expected, and as tensions around North Korea eased.
Apple Inc. (>> Apple), which is holding an event later Tuesday, rose by 0.3%, after Monday's was down 0.4% early Tuesday. Investors expect the iPhone maker to reveal its 10th anniversary mobile phone, which reportedly has a price tag of around $1,000 . The Cupertino, Calif.-based company's keynote presentation is slated to commence at 1 p.m. Eastern.
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Economic reports: On the economic front, a report on Job openings in the U.S. set a record in July, climbing steadily despite the lowest unemployment rate in years. The Labor Department reported on Tuesday that openings edged up to 6.17 million in July from 6.12 million in June. It's the first time openings have topped 6 million for two straight months since the government began keeping track in 2000.
Data earlier showed sentiment among small-business owners ticked up in August .
Moving stocks: Shares of Teva Pharmaceuticals Industries Ltd.(>> Teva Pharmaceutical Industries Limited) rose nearly 11% after Israeli-based pharmaceutical group said late Monday it will sell its Pargard IUD product to Cooper Cos.(>> Cooper Companies Inc) for $1.1 billion in cash. Cooper shares were off 0.3%.
Equifax Inc.(>> Equifax Inc.) shares rose 0.8%. Standard & Poor's announced late Monday a downgrade of its outlook on the credit-reporting agency to negative from stable in the wake of a recent breach that put the data of 143 million Americans at risk. Equifax shares fell 8.2% on Monday.
Other markets:Asian markets saw tepid gains, outside of a 1.2% rally for the Nikkei which hit its best intraday level in a month as the yen continued to fall against the dollar. The dollar index , meanwhile, was modestly higher, marked by that stronger dollar/yen cross.
The British pound hit the highest level this year after U.K. inflation rose by more than expected.
The Stoxx Europe 600 index put on about 0.5%. Oil prices drifted lower, and gold prices also fell modestly.