The Nasdaq registered its fourth record close in a row on Tuesday, thanks to gains in healthcare stocks. The tech-laden’s all-time high came in as the Dow failed to hit its psychologically significant level of 20,000. The blue-chip index finished in the red, while the S&P 500 ended flat as investors mostly remained cautious ahead of a news conference by President-elect Donald Trump, to be held on Wednesday, his first since being elected on Nov 8.
Since the election result, the stock market has more or less gained traction on optimism that Trump’s promises to deregulate certain sectors, lower corporate taxes and inject fiscal stimulus measures will drive growth. Beyond Trump’s comments, investors also eagerly awaited the commencement of the earnings season and whether it could provide some support to the recent Trump-induced market rally.
For a look at the issues currently facing the markets, make sure to read today’s Ahead of Wall Street article.
The Dow Jones Industrial Average (DJI) decreased 0.2%, to close at 19,855.53. The S&P 500 remained unchanged from Monday at 2,268.90. The Nasdaq Composite Index, however, closed at 5,551.82, gaining 0.4%. The tech-laden index ended in the green for the sixth straight day and posted its longest streak of all-time highs since Dec 27, 1999.
The fear-gauge CBOE Volatility Index (VIX) declined 0.6% to settle at 11.49. A total of around 3.6 billion shares were traded on Tuesday on the NYSE. Advancers outpaced declining stocks on the NYSE. For 62% stocks that advanced, 35% declined.
The Nasdaq hit a new intraday record and posted a new closing high, as health care stocks moved north. Healthcare companies, which fell last year, are making some of the biggest gains. Illumina (ILMN - Free Report) jumped 16.6% on Tuesday after the genetic analysis company introduced its NovaSeq series.
Other companies such as Boston Scientific Corporation (BSX - Free Report) , Zimmer Biomet Holdings, Inc. (ZBH - Free Report) , Regeneron Pharmaceuticals, Inc. (REGN - Free Report) and Intuitive Surgical, Inc. (ISRG - Free Report) soared 6.4%, 6.2%, 5.1% and 3.3%, respectively. The broader Health Care Select Sector SPDR (XLV) increased 0.4%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Focus is on Trump
Investors, in the meantime, focused on a news conference from Trump set for Wednesday. US stocks had climbed in the last two months in anticipation of financial deregulation, tax cuts and expansion in infrastructure spending based on Trump’s campaign promises.
Trump plans to rim business tax rate to 15% from 35%. The lower tax burden is expected to boost profits for large companies. Trump is also in favor of beefing up public spending by hundreds of billions of dollars on infrastructure. He said that he will support more spending on transportation and telecommunications infrastructure, clean water and electricity transmission in order to accelerate economic growth.
The Q4 earnings season also takes the spotlight. For Q4 as a whole, total earnings for the S&P 500 companies are expected to be up 3.1% from the same period last year on 3.9% higher revenues (read more: Can the Bank Stock Rally Continue?).
Stocks That Made Headlines
United Continental Gains on Improved Q4 Unit Revenue View
Shares of United Continental Holdings (UAL - Free Report) have been on an uptrend in recent times. The stock has comfortably outpaced the Zacks categorized Transportation-Airline industry in the last three months. (Read More)
Adobe Raises Revenue Guidance After TubeMogul Acquisition
Adobe Systems Incorporated (ADBE - Free Report) closed its acquisition of TubeMogul on Dec 19 and hosted a conference call on Jan 9 to provide updates on financial targets following the same. (Read More)
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