US STOCKS-S&P 500, Nasdaq hit record highs on AI momentum, Dow edges up after weak retail sales
18/06/2024 21:47
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U.S. retail sales rise less than expected in May
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Lennar drops as home delivery forecast disappoints
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Citigroup hikes S&P 500 year-end target to 5,600 points
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Indexes up: Dow 0.15%, S&P 0.25%, Nasdaq 0.03%
(Updates with more closing data)
By Echo Wang
June 18 (Reuters) -
The S&P 500 and Nasdaq closed at record highs on Tuesday,
buoyed by Nvidia's continued surge to new peaks, while the Dow
ended barely higher in subdued pre-holiday trading following
softer-than-expected U.S. retail sales data.
Nvidia NVDA.O overtook Microsoft MSFT.O to become the
world's most valuable company, ending the day with a market
capitalization of $3.22 trillion.
Other chip stocks also extended their recent rallies,
boosting the Philadelphia SE Semiconductor index .SOX to a
record high.
Qualcomm QCOM.O , Arm Holdings ARM.O and Micron
MU.O advanced between 2.1% and 8.7%, with Micron hitting a
record high.
"It's really the AI story," said Ty Draper, financial
advisor at Beacon Capital Management in Franklin, Tennessee.
The Nasdaq notched a seventh record closing high in a row,
as gains in many chip stocks offset losses in Alphabet
GOOGL.O , Amazon AMZN.O and Meta Platforms META.O .
Retail sales rose 0.1% in May, versus the 0.3% growth
forecast by economists polled by Reuters, while another report
showed surprisingly strong May industrial production and
manufacturing output.
Following the news, markets slightly increased bets on two
Federal Reserve interest rate cuts this year, LSEG's FedWatch
showed, despite U.S. central bankers' most recent projections
for just one easing.
Financial .SPSY and technology .SPLRCT led advances
among the 11 S&P 500 sectors, up 0.64% and 0.61% respectively,
while communication services .SPLRCL and consumer
discretionary were the biggest losers.
Fed officials' comments on Tuesday offered nothing
compelling to trade on. New York Fed President John Williams
said rates will gradually come down, while Richmond Fed's Thomas
Barkin said he required more months of economic data before
supporting a rate cut.
Some market observers noted nothing surprising emerged.
"That's why the markets stay unchanged today," said Jim Awad,
senior managing director at Clearstead Advisors LLC in New York.
U.S. markets will be closed on Wednesday for the Juneteenth
holiday.
Hopes for multiple rate cuts this year, excitement for
AI-related companies and robust earnings from other tech firms
have bolstered equities in recent months, with gains
concentrated in a few heavily weighted stocks.
Citigroup raised the year-end target for the S&P 500 .SPX
to 5,600 points from 5,100.
The Dow Jones Industrial Average .DJI rose 56.76
points, or 0.15%, to 38,834.86. The S&P 500 .SPX climbed 13.80
points, or 0.25%, to 5,487.03 and the Nasdaq Composite .IXIC
gained 5.21 points, or 0.03%, at 17,862.23.
Shares of education technology provider Chegg CHGG.N rose
3.45% after announcing job cuts in a restructuring.
Homebuilder Lennar LEN.N fell 4.98% after forecasting
lower-than-expected third-quarter home deliveries.
Advancing issues outnumbered decliners by a 1.79-to-1 ratio
on the NYSE, which had 259 new highs and 93 new lows.
Volume on U.S. exchanges was 10.96 billion shares,
compared with the 11.79 billion average for the full session
over the last 20 trading days.
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Tech stocks power Wall Street gains https://tmsnrt.rs/4b2zugY
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(Reporting by Echo Wang in New York; Additional reporting by
Lisa Mattackal and Ankika Biswas in Bengaluru; Editing by
Shounak Dasgupta, Maju Samuel and Richard Chang)
((e.wang@thomsonreuters.com))