U.S. Stocks Climb as Tech Sector Bounces Back
20 June 2017 - 5:37AM
Dow Jones News
By Mike Bird and Ese Erheriene
Gains in technology shares propelled U.S. stocks higher
Monday.
The Dow Jones Industrial Average added 120 points, or 0.6%, to
21505, and the S&P 500 index added 0.7%, on track for fresh
records. The Nasdaq Composite climbed 1.3%.
Technology shares in the S&P 500 have risen about 19% this
year, making tech the index's best-performing sector, but the
stocks also have had some recent slumps. On Monday, the sector was
headed toward its largest percentage increase of 2017, with some
analysts saying investors were hunting for value after three
sessions of declines.
"Now you're buying Apple at a discount," said Mike Bailey,
director of research at FBB Capital Partners.
Apple was among the biggest gainers in Dow industrials, climbing
2.8% after falling in six of the past seven sessions. Cisco Systems
added 1%. Shares of tech companies in the S&P 500 rose 1.6%,
headed toward their biggest one-day advance since December.
U.S. government bonds weakened, with the yield on the two-year
Treasury note near its 2017 high, after Federal Reserve Bank of New
York president William Dudley signaled a willingness to gradually
increase interest rates and to keep the economy humming.
The yield on the benchmark 10-year Treasury note rose to 2.188%,
according to Tradeweb, from 2.157% Friday. Yields rise as prices
fall.
Mr. Dudley's comments may have been reassuring to those "worried
that the Fed is looking to raise rates quickly, or too quickly,"
said Brian Nick, chief investment strategist at TIAA Investments,
an affiliate of Nuveen Investments.
These comments, along with the results from France's legislative
election, may have cheered stock investors today, Mr. Nick
said.
European stocks gained ground after the French gave President
Emmanuel Macron's centrist party an outright majority in the
country's parliament. The victory of the French president's
political party gives him a stronger mandate to implement his
policies in the eurozone's second largest economy, while offering a
further sign of the receding tide of populist European politics
that concerned investors, analysts say.
"There is a new political wind blowing through Europe," said
Vincent Juvyns, global market strategist at J.P. Morgan Asset
Management. "Macron can now more or less freely implement his
program, he won't have to compromise as much as he did when he was
economy minister."
France's CAC 40 index gained 0.9%. The Stoxx Europe 600 index
added 0.9%. This week, investors are preparing for the start of
formal Brexit negotiations and a decision on whether to include
China's domestically traded A-shares in a benchmark emerging-market
index that is widely followed.
Japan's Nikkei Stock Average closed up 0.6%, with a softer yen
aiding a move back above 20000 points. Hong Kong's Hang SengIndex
gained 1.2%, and the Shanghai Composite Index rose 0.7%.
--Ese Erheriene contributed to this article.
Write to Mike Bird at Mike.Bird@wsj.com and Ese Erheriene at
ese.erheriene@wsj.com
(END) Dow Jones Newswires
June 19, 2017 15:22 ET (19:22 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.