Strength in manufacturing pushed the Dow Jones industrial average to within two points of 17,000 for the first time just after midday Tuesday, joining small caps and transportation stocks at records in a pattern that chart analysts consider bullish.
Netflix Inc., Amazon.com Inc. and Biogen Idec Inc., among the biggest losers during a two-month selloff earlier this year, rose at least 2.3 percent. International Business Machines Corp. climbed 2.8 percent, leading a rally among technology stocks. General Motors Co. jumped 3.6 percent after a surprise sales gain in the auto industry’s best month since July 2006.
The Dow closed up 129.47 points, or 0.8 percent, at 16,956.07. The Standard & Poor’s 500 Index climbed 0.7 percent to 1,973.32. The Russell 2000 Index of smaller companies rallied 1.1 percent and the Dow Jones Transportation Average gained 0.7 percent. The Dow, S&P 500 and transport gauge all closed at records, while the Russell 2000 touched an intraday high.
Simultaneous gains in disparate sections of the market are sometimes cited by chart analysts who base predictions on charts as evidence economic growth is pervasive enough to fuel additional gains.
“The breadth sends a message about the strength of the bull,” Rex Macey, chief allocation officer at Wilmington Trust in Atlanta, said in a phone interview. The firm oversees $82 billion. “People are comfortable with the story of the economic backdrop that we’ve got going on. People feel like they’re missing the boat and they want to get on.”
Stocks are extending a rebound from the selloff that started with biotech and small-cap stocks about five months ago. Equities have rallied since the S&P 500 reached a two-month low in April as central bank stimulus spread from Europe to Japan and the U.S. and economic data suggested global growth is strengthening.
The Russell 2000 has retraced nearly all of its losses after a 9.3 decline through May 15. The Nasdaq Biotechnology Index, which tumbled 21 percent from February to April, soared 2.3 percent today.
Biogen Idec climbed 3.1 percent to $325.05 and Amazon.com added 2.3 percent to $332.28. Both stocks sank 16 percent between March and April.
Manufacturing in China expanded in June by the fastest pace this year, a purchasing managers’ index compiled by the government showed today.
The Institute for Supply Management’s U.S. factory index was little changed at 55.3 in June from 55.4 in the prior month, the Tempe, Ariz.-based group’s report showed. Readings above 50 indicate expansion.
GM rose 3.6 percent to $37.59, its highest level since March. The company reported a gain of 1 percent in auto sales, beating the average analyst estimate for a 6.3 percent decline.
Netflix gained 7.4 percent to $473.10. Goldman Sachs Group Inc. boosted its recommendation on the Los Gatos, Calif.- based company to buy from neutral, citing the potential for global subscription growth. The shares have gained 29 percent for the year, recovering from a 31 percent plunge in March and April.
Netflix Inc., Amazon.com Inc. and Biogen Idec Inc., among the biggest losers during a two-month selloff earlier this year, rose at least 2.3 percent. International Business Machines Corp. climbed 2.8 percent, leading a rally among technology stocks. General Motors Co. jumped 3.6 percent after a surprise sales gain in the auto industry’s best month since July 2006.
The Dow closed up 129.47 points, or 0.8 percent, at 16,956.07. The Standard & Poor’s 500 Index climbed 0.7 percent to 1,973.32. The Russell 2000 Index of smaller companies rallied 1.1 percent and the Dow Jones Transportation Average gained 0.7 percent. The Dow, S&P 500 and transport gauge all closed at records, while the Russell 2000 touched an intraday high.
Simultaneous gains in disparate sections of the market are sometimes cited by chart analysts who base predictions on charts as evidence economic growth is pervasive enough to fuel additional gains.
“The breadth sends a message about the strength of the bull,” Rex Macey, chief allocation officer at Wilmington Trust in Atlanta, said in a phone interview. The firm oversees $82 billion. “People are comfortable with the story of the economic backdrop that we’ve got going on. People feel like they’re missing the boat and they want to get on.”
Stocks are extending a rebound from the selloff that started with biotech and small-cap stocks about five months ago. Equities have rallied since the S&P 500 reached a two-month low in April as central bank stimulus spread from Europe to Japan and the U.S. and economic data suggested global growth is strengthening.
The Russell 2000 has retraced nearly all of its losses after a 9.3 decline through May 15. The Nasdaq Biotechnology Index, which tumbled 21 percent from February to April, soared 2.3 percent today.
Biogen Idec climbed 3.1 percent to $325.05 and Amazon.com added 2.3 percent to $332.28. Both stocks sank 16 percent between March and April.
Manufacturing in China expanded in June by the fastest pace this year, a purchasing managers’ index compiled by the government showed today.
The Institute for Supply Management’s U.S. factory index was little changed at 55.3 in June from 55.4 in the prior month, the Tempe, Ariz.-based group’s report showed. Readings above 50 indicate expansion.
GM rose 3.6 percent to $37.59, its highest level since March. The company reported a gain of 1 percent in auto sales, beating the average analyst estimate for a 6.3 percent decline.
Netflix gained 7.4 percent to $473.10. Goldman Sachs Group Inc. boosted its recommendation on the Los Gatos, Calif.- based company to buy from neutral, citing the potential for global subscription growth. The shares have gained 29 percent for the year, recovering from a 31 percent plunge in March and April.