U.S. equities climbed higher on Tuesday as traders returned after the long holiday weekend and looked ahead to what 2017 will bring. Good things apparently, as prices rose to break a three-day losing streak and once again put 20,000 in play.
In the end, the Dow Jones Industrial Average gained 0.6%, the S&P 500 gained 0.9%, the Nasdaq Composite wafted up 0.9% and the Russell 2000 gained 0.6%. Treasury were mixed, the dollar was stronger, gold gained 0.8% and oil reversed earlier gains to lose 2.5%.
Telecom stocks led the way higher with a 1.9% gain following by healthcare, up 1.4%. Utilities were the laggards, down 0.3%. Verizon Communications Inc. (NYSE:VZ) gained 2.3% and CenturyLink Inc (NYSE:CTL) gained 6.6% on analyst upgrades.
Xerox Corp (NYSE:XRX) gained nearly 20% thanks to the completion of the spinoff of Conduent and an upgrade from Credit Suisse analysts amid confidence in management’s turnaround efforts. Groupon Inc (NASDAQ:GRPN) gained 5.4% on an upgrade from RBC citing valuation and efforts to streamline its international footprint.
Automakers were in the news as President-elect Donald Trump hit General Motors Company (NYSE:GM) for building some Chevy Cruze models in Mexico, reiterating the threat of a border tax. Ford Motor Company (NYSE:F) gained 3.8% after announcing plans to scrap a new $1.6 billion plant in Mexico in exchange for a $700 million investment in Michigan adding 700 jobs.
Fiat Chrysler Automobiles NV (NYSE:FCAU) gained 4.7% on the announcement of a collaboration with Google on connected-car systems and reports it will reveal an autonomous vehicle concept at the CES 2017 show.
After the close, Tesla Motors Inc (NASDAQ:TSLA) dell 2.2% after reporting weaker-than-expected Model S deliveries
On the economic front, the ISM manufacturing index increased to 54.7 in December from 53.2 in November, beating expectations for a 53.7 result. New orders, production and employment all reached new highs for 2016.
Looking ahead, all eyes are on Wednesday’s release of the latest Federal Reserve meeting minutes. Also watch for a continuation of overnight fixed income and currency market volatility as trading in China was halted as emerging market countries struggle to deal with the U.S. dollar’s recent surge.
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