Shares of Apple hit a new high
US stock market opened the week on a positive note on Monday, 01 May 2017 with the top-weighted technology and financials sectors pacing the advance. Investors received several headlines from the nation's capital on Monday. The first was news of an agreement between congressional leaders that, if approved, will keep the government funded through September. The deal, which puts fears of a government shutdown on hold, sent the S&P 500 into positive territory at the opening bell.
The Dow Jones Industrial Average which dipped in and out of negative territory, finished down 27.05 points, or 0.1%, at 20,913.46. The S&P 500 index closed up 4.13 points, or 0.2%, at 2,388.33. The Nasdaq Composite Index finished up 44 points, or 0.7%, to a record 6,091.60, after touching an all-time intraday high of 6,100.73.
The tech-heavy Nasdaq closed at a record Monday, with shares of Apple hitting a new high, while the Dow industrials slipped lower as investors digested a raft of economic reports and looked ahead to the start of the Federal Reserve's policy meeting on Tuesday.
Only five of the 11 main sectors finishing higher. Tech shares led the charge, finishing up 0.9%, followed by a 0.6% gain in real-estate stocks. Telecoms were the largest decliners, down 0.8%, while utilities shed 0.7%.
However, the next headline, which was a statement from President Trump, resulted in a small sell-off in the early-afternoon session. Mr. Trump said that he may favor breaking up the nation's biggest banks, which briefly sent the financial sector lower. However, stocks recovered shortly thereafter as the headline provided little new information; President Trump has mentioned reinstating Glass-Steagall prior to today's announcement.
Dow was pressured by a 1.3% decline in Boeing and a 1.2% decline in shares of Home Depot . Apple shares closed up 2.1% at a record $146.60 after reaching an intraday record of $147.20. The stock is a major component in the three major U.S. stock indexes. The company reports quarterly results Tuesday afternoon.
Earlier, the blue-chip benchmark briefly slipped into negative territory following comments by President Donald Trump that he was looking at breaking up big banks, with a retreat in financials contributing to much of that dip. Over the weekend, Congress cut a deal to fund the government through Sept. 30, which includes an increase in military spending.
The Atlanta Fed tracker of GDP points to a strong rebound for the second quarter after the slowest quarter in three years. The GDPN ow model forecasts 4.3% growth. That would be the strongest growth since the third quarter of 2014. Strong economic growth can make the Federal Reserve tighten monetary policy and increase the fed-funds rate. Higher rates can boost the dollar and make gold less competitive against interest-bearing investments.
Among other economic data on Monday, the personal-consumption-expenditures, or PCE index, fell 0.2% in March to mark the first decline in more than a year. U.S. manufacturing growth cooled off a bit in April, with the ISM manufacturing index slipping to 54.8% from 57.2%.
Other U.S. reports this week include a policy statement from the Fed on Wednesday that could influence assumptions about the path for interest rates and metals which don't offer a yield.
Investors will be looking at important labor-market report, with April jobs due Friday. Market is forecasting that 190,000 jobs were created in April, with the unemployment rate holding steady at 4.5%.
On Monday, the dollar, one of the biggest drivers of dollar-pegged commodities, as measured by the ICE U.S. Dollar Index was trading nearly flat at 99.07.
Crude oil prices logged their lowest finish in about five weeks Monday, 01 May 2017 on concerns that rising U.S. crude output would offset efforts by OPEC and other large crude producers to cap a nagging global oil glut. The price drop extends a downbeat tone in crude trade into May after futures contracts registered a second straight monthly decline.
June West Texas Intermediate crude fell 49 cents, or 1%, to settle at $48.84 a barrel on the New York Mercantile Exchange. WTI prices lost about 2.5% in April. July Brent on London's ICE Futures exchange declined by 53 cents, or 1%, to $51.52 a barrel.
Bullion metals ended sharply lower at Comex on Monday, 01 May 2017. Gold futures settled sharply lower with the yellow metal booking its lowest finish in three weeks, following U.S. data implying a strong rebound in second-quarter economic growth.
June gold dropped $12.80, or 1%, to settle at $1,255.50 an ouncethe lowest for most-active contract since 10 April 2017. The yellow metal rose over the past two sessions, but saw a weekly loss of 1.6%, as geopolitical risks, particularly in Europe, appear to have cooled somewhat, undercutting haven demand for commodities like gold that thrive in uncertainty. Silver for July delivery declined 42 cents, or 2.4%, to $16.842 an ouncethe lowest since mid-January.
In the bond market, Treasuries settled lower across the board, however, selling pressure was not distributed equally across the yield curve. The 10-yr yield finished four basis points higher while the 2-yr yield added only two basis points.
Today's trading volume was relatively light. Market were closed across Europe and most of Asia in observance of Labor Day. 874.2 million shares changed hands at the NYSE floor.
Tomorrow, investors will not receive any economic reports, but April auto and truck sales will be released throughout the day.
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