Yahoo News – New York (AFP) – Wall Street investors were back in rally mode Tuesday, pushing the S&P 500 and Nasdaq to new records and lifting the dollar against the euro on renewed optimism about US President Donald Trump’s policies.
The buoyant spirt, which also lifted the Dow back to within striking distance of the 20,000-point milestone, came on a muted day for other leading markets. The London bourse was flat and the pound was pressured after a British court ruled that Britain’s government must win parliament’s approval before beginning formal Brexit negotiations.
US stocks began quietly but picked up momentum as the day progressed. Trump met with leading US automakers and took action to advance two major pipeline projects that had been blocked by former president Barack Obama.
Meanwhile, House speaker Paul Ryan signaled support for public works spending, telling reporters he wants an infrastructure package “as expansive as possible.”
The gains were more in line with the market’s bullishness in the six weeks after election, in contrast to recent weeks when US stocks have stagnated.
Analysts were generally wary of Trump’s inauguration address, which emphasized an “America First” agenda and revived fears of trade protectionism, backed up by his first executive orders Monday.
Jack Ablin, chief investment officer at BMO Private Bank said until now it seemed like backing away from trade pacts like the North American Free Trade Agreement and the Trans-Pacific Partnership “were the big priorities and investors were sort of disappointed with that.”
“Investors finally got a lot of what they were looking for,” he said.
Meanwhile the pound slipped after the UK Supreme Court’s verdict requiring legislative approval for Prime Minister Theresa May’s Brexit plan. However, analysts said the move was probably not a significant obstacle to May. By 2200 GMT, the pound was back to flat against the US dollar.
Stock markets in Paris and Frankfurt posted modest gains, but the Nikkei dropped 0.6 percent on worries about US protectionism.
Among individual stocks, TransCanada, backer of the Keystone XL pipeline, and Energy Transfer, the driving force of the Dakota Access Pipeline, each rose about 3.5 percent after Trump signed executive orders to paved the way for both projects.
DuPont and Dow each gained about 4.5 percent as DuPont reported better-than-expected earnings and pushed back the time-frame for completing a merger of the chemical giants. DuPont executives told analysts they were working with regulators on a divestiture package to win approval for the deal.
Verizon slumped 4.4 percent after it reported lower-than-expected fourth-quarter earnings and said it was pushing back the target date for its $4.8 billion acquisition of core Yahoo assets following a pair of large data hack breach disclosures by Yahoo.
In London, shares in EasyJet slumped nearly nine percent after the no-frills airline said it expects full-year profits to suffer a bigger-than-expected hit from a soft pound.
British telecom and TV group BT plunged 20 percent after the company warned that its profits would take a much larger hit than expected from accounting irregularities in Italy.
– Key figures near 2200 GMT –
New York – Dow: UP 0.6 percent at 19,912.71 (close)
New York – S&P 500: UP 0.7 percent at 2,280.07 (close)
New York – Nasday: UP 0.8 percent at 5,600.96 (close)
London – FTSE 100: DOWN less than 0.1 percent at 7,150.34 (close)
Frankfurt – DAX 30: UP 0.4 percent at 11,594.94 (close)
Paris – CAC 40: UP 0.2 percent at 4,830.03 (close)
EURO STOXX 50: UP 0.2 percent at 3,279.45
Tokyo – Nikkei 225: DOWN 0.6 percent at 18,787.99 (close)
Shanghai – Composite: UP 0.2 percent at 3,142.55 (close)
Hong Kong – Hang Seng: UP 0.2 percent at 22,949.86 (close)
Euro/dollar: DOWN at $1.0732 from $1.0761
Pound/dollar: FLAT at $1.2521
Dollar/yen: UP at 113.81 yen from 112.84 yen
Oil – West Texas Intermediate: UP 43 cents at $53.18 per barrel
Oil – Brent North Sea: UP 57 cents at $55.44 per barrel
Image Source: Business Insider
