Wall Street climbed on Tuesday as a surge in Apple shares propelled the tech-heavy Nasdaq to record highs, while better-than-expected U.S. manufacturing sector data fueled optimism around a post-pandemic economic recovery.
Apple Inc gained 1.7%, rising for the second straight day after its stock split took effect, as a report said the iPhone maker had asked suppliers to make at least 75 million 5G iPhones for later this year.
ISM data showed U.S. factory activity expanded for the third straight month to a reading of 56.0 in August, the highest since November 2018. The figures follow encouraging manufacturing surveys from China and Europe earlier in the day.
Investors will keep a close eye on the monthly U.S. jobs report due on Friday amid signs the labor market’s recovery is stalling.
Wall Street’s main indexes recorded their fifth straight monthly gain on Monday, riding massive central bank support, U.S. government aid and demand for tech-focused stocks.
While the Nasdaq and the S&P 500 have scaled all-time highs recently, the blue-chip Dow is still about 4% below its February peak.
“Investors are continuing to reward the ability to innovate and adapt … not just to the tech companies, but those companies that are in other industries that have been good users of technology,” said Stephen Lee, portfolio manager at Logan Capital Management in Newtown Square, Pennsylvania.
Technology, communication services and consumer discretionary stocks were leading gains among the major S&P sectors.
Treasury Secretary Steven Mnuchin’s comment that a new coronavirus relief bill will “hopefully” be unveiled next week also boosted sentiment.
U.S. politics will take center stage in the coming weeks. Republican president Donald Trump, who is running for re-election against Democratic presidential nominee Joe Biden, has seen his polling gap with the former vice president narrow recently.
At 10:11 a.m. ET, the Dow Jones Industrial Average was up 4.16 points, or 0.01%, at 28,434.21 and the S&P 500 was up 6.82 points, or 0.19%, at 3,507.13. The Nasdaq Composite was up 98.94 points, or 0.84%, at 11,874.40.
Among other stocks, Zoom Video Communications Inc surged 43.5% after the video-conferencing platform raised its annual revenue forecast by more than 30% as it converted more of its huge free user base to paid subscriptions.
Walmart Inc rose 2.6% after the retail giant unveiled the perks of its new loyalty program, Walmart Plus, which will grant subscribers unlimited free delivery, fuel discounts and no checkout lines.
Tesla Inc fell 4.3% after the electric-car maker announced plans to raise up to $5 billion through a share sale program a day after its 5-for-1 stock split.
Advancing issues outnumbered decliners for a 1.10-to-1 ratio on the NYSE. Declining issues outnumbered advancers for a 1.17-to-1 ratio on the Nasdaq.
The S&P index recorded 20 new 52-week highs and no new low, while the Nasdaq recorded 59 new highs and 22 new lows.
(This story corrects headline and paragraph 3 to show U.S. factory activity hit a near two-year high, not 19-month high)
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