» Subscribe Today!
The Power of Information
Home
The Ledger - EST. 1978 - Nashville Edition
X

Forgot your password?
Skip Navigation LinksHome > Article
VOL. 41 | NO. 18 | Friday, May 05, 2017

All is calm: US stock indexes nudge again to record highs

Print | Front Page | Email this story

NEW YORK (AP) — A turn higher in the last few minutes of trading was enough to nudge U.S. indexes to more record highs Monday as fear seemed to drain out of the market.

Trading was remarkably calm following the weekend's presidential election in France, which had the potential to upset global markets. The candidate who was in favor of keeping France in the European Union and in the euro currency won, to the relief of investors who feared the alternative would have hurt global trade. That helped calm markets enough that an index used to measure the market's fear level dropped to its lowest level since 1993.

The Standard & Poor's 500 index wafted up and down through the day before ending at 2,399.38, up by just 0.09 points. The Dow Jones industrial average likewise edged up a fraction of a percent, adding 5.34 points to 21,012.28.

The Nasdaq composite rose 1.90 points, or less than 0.1 percent, to 6,102.66. Small-company stocks fell, and the Russell 2000 index lost 5.36, or 0.4 percent, to 1,391.64.

Markets around the world have been tearing higher in recent weeks, due in part to excitement about the French election and strong earnings reports from U.S. companies.

"Corporate earnings have been phenomenal, the best quarter in five years," said Phil Orlando, chief equity strategist at Federated Investors. "The earnings recession that was about seven or eight quarter long is definitively behind us. It's over."

More than 80 percent of companies in the S&P 500 have reported their results for the first three months of the year, and most have topped analysts' expectations. With the U.S. job market continuing to improve, along with economies around the world, Orlando says he expects profits to keep rising through the year. That has him, unlike market critics, not worried that stocks have grown too expensive relative to their profits, and he expects further gains.

"Everyone is starting to get a little more confident now," he said.

Confidence has grown enough that the VIX volatility index on Monday sank to its lowest level since 1993. The VIX measures how much investors are paying to protect themselves from upcoming swings in the S&P 500, and it has been on a general trend downward since shortly before Election Day.

Newell Brands jumped to the largest gain in the S&P 500 Monday after reporting stronger revenue and profit for its latest quarter than analysts expected. The company, whose brands include Paper Mate, Sharpie and Calphalon, also raised its earnings forecast for the year. Shares jumped $5.54, or 11.9 percent, to $51.93.

Kate Spade surged $1.41, or 8.3 percent, to $18.38 after agreeing to a $2.4 billion buyout by Coach, its rival in the luxury goods market. Coach will pay $18.50 per share for Kate Spade.

Often when companies announce takeovers, the purchaser will see its share price drop on worries that it paid too much or pursued an ill-fitting deal. But Coach rose $2.05, or 4.8 percent, to $44.71.

Tribune Media jumped $2.11, or 5.2 percent, to $42.40 after Sinclair Broadcast Group said it would buy its rival in a cash-and-stock deal valued at $43.50 per share, or a total of $3.9 billion. Sinclair fell 83 cents, or 2.2 percent, to $36.13.

Tyson Foods dropped $3.85, or 6.1 percent, to $59.48 after reporting weaker revenue and earnings for its latest quarter than analysts expected. The company said fires at two of its chicken plants hurt results.

In markets abroad, the French CAC 40 fell 0.9 percent. But that follows a 7.4 percent surge in the preceding two weeks, when investors sent French stocks higher in anticipation of a victory by Emmanuel Macron. In Germany, the DAX slipped 0.2 percent. The FTSE 100 index in London was virtually flat.

Asian markets fared better. Japan's Nikkei 225 index jumped 2.3 percent, as did South Korea's Kospi index. The Hang Seng in Hong Kong rose 0.4 percent.

The euro had been climbing against the dollar in recent weeks as expectations built for a Macron victory. Following the actual result, it fell like the French stock index. The euro slipped to $1.0930 from $1.0990 late Friday. The dollar rose to 113.07 Japanese yen from 112.61 yen. The British pound slipped to $1.2943 from $1.2969.

In the commodities market, benchmark U.S. crude rose 21 cents to settle at $46.43 per barrel. Brent crude, the international standard, rose 24 cents to settle at $49.34 a barrel.

Natural gas fell 9 cents to $3.17 per 1,000 cubic feet, heating oil rose 2 cents to $1.46 per gallon and wholesale gasoline added a penny to $1.52 per gallon.

Gold rose 20 cents to settle at $1,227.10 per ounce, silver fell 2 cents to $16.26 per ounce and copper fell 4 cents to $2.49 per pound.

Bond yields edged higher. The yield on the 10-year Treasury rose to 2.38 percent from 2.35 percent late Friday. The two-year yield ticked up to 1.32 percent from 1.31 percent, and the 30-year Treasury yield rose to 3.03 percent from 2.99 percent.

Follow us on Facebook, Twitter & RSS:
Sign-Up For Our FREE email edition
Get the news first with our free weekly email
Name
Email  
TNLedger.com Knoxville Editon
RECORD TOTALS DAY WEEK YEAR
PROPERTY SALES 0 0 0
MORTGAGES 0 0 0
FORECLOSURE NOTICES 0 0 0
BUILDING PERMITS 0 0 0
BANKRUPTCIES 0 0 0
BUSINESS LICENSES 0 0 0
UTILITY CONNECTIONS 0 0 0
MARRIAGE LICENSES 0 0 0