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S&P 500 Reaches 19th Record High of 2017

Sharper moves are not expected by some analysts until October

   

On Thursday, stocks rose for the sixth consecutive session with the S&P 500 rising to its 19th record close of the year. This surpassed the number of new highs set in all of 2016.

The market was driven by strong first-quarter earnings and robust economic data. Stocks were strong again despite expectations that the president’s tax plan and plans for fiscal stimulus appear to be in trouble in Congress.

The Dow Jones Industrial Average rose 0.3%, the S&P 500 gained 0.4%, and the Nasdaq jumped 0.7%. The gains were made despite a drop in the price of crude oil to under $50 per barrel. WTI crude oil spot futures closed at $48.87 per barrel, a loss of 4.8% for the day.

However, the Information Technology and Consumer Discretionary sectors gained 0.8% and 0.7%, respectively, which offset the Energy sector’s loss of 1.6%. Eight of the S&P 500’s 11 sectors had gains.

Best Buy Co Inc (NYSE:BBY) led the consumer group by leaping 21% to $61.25 and a new record high following a report that exceeded both top and bottom line estimates and management’s increase of its profit and sales outlook for the year. Netflix rose 3.4% following the increase of its price target by a key Wall Street analyst.

At the close the Dow Jones Industrial Average rose 71 points to 21,083; the S&P 500 gained 11 at 2,415; the Nasdaq rose 42 points to 6,205; and the Russell 2000 added one point at 1,383. The NYSE’s primary market traded 815 million shares with total volume of 3.5 billion shares. The Nasdaq crossed 1.8 billion shares. On the Big Board, advancers exceeded decliners by just 1.1-to-1, and on the Nasdaq, advancers led by 1.2-to-1. Blocks on the NYSE fell to 6,900 from 7,080 on Wednesday.


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S&P 500 Reaches 19th Record High of 2017

The S&P 500 finally broke through the stubborn resistance line at 2,400 that has held back an advance since March. Yesterday, the index broke through resistance, leaving a small 2.4-point gap in its wake.


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The Dow Jones pushed ahead, as well, finally breaking the triple-top resistance line connecting the highs of each of the last three months but, like the 500, achieving the break on low volume and narrow breadth.

Conclusion: Mr. Market seldom does exactly what we expect, when we expect it. I am still not convinced that yesterday’s breakouts of the two major indices will lead to a major summer rally. And, like Jeff Saut, of Raymond James, I don’t expect a major breakout before October. We both see “upside energy waning,” and that tells us that yesterday’s breakout has a limited extension.

EDITOR’S NOTE: Our Chief Technical Analyst Sam Collins is retiring on June 1. Your Daily Trader’s Alert emails will continue uninterrupted, but will feature new analysts going forward. To learn more about the changes click here, and to join our “online going-away party” and wish Sam farewell click here.

Today’s Trading Landscape

To see a list of the companies reporting earnings today, click here.

For a list of this week’s economic reports due out, click here.

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