Wall Street stocks have closed higher, with market-leading growth shares kick-starting indexes’ climb as investors looked past disappointing US economic data.
Despite their advances, all three major US stock indexes ended the session below last Friday’s close, ending a five-week streak of weekly gains.
Investors favoured growth over value, with megacap tech stocks, led by Apple and Microsoft, doing the heavy lifting.
The University of Michigan’s preliminary consumer sentiment data for November unexpectedly dropped to a 10-year low, and a Labour Department report showed job openings barely budged from record highs even as workers are quitting in record numbers.
“Markets drifted higher today despite a very weak consumer sentiment report, as inflation seems to be hurting consumers more than corporate profits,” said David Carter, chief investment officer at Lenox Wealth Advisors in New York.
The souring mood of the consumer could be worrisome to retailers as the holiday shopping season draws near, and is likely to draw intensified scrutiny to upcoming retail earnings reports.
Walmart, Target, Home Depot and Macy’s are among the high-profile retailers expected to report next week.
“Investors will be focused on guidance from retailers to determine if inflation will crimp profit margins or if costs can be passed through,” Carter said.
Retail results will herald the last days of what was a largely upbeat third-quarter earnings season.
As of Friday, 459 of the companies in the S&P 500 have reported. Of those, 80 per cent delivered consensus-beating earnings, according to Refinitiv.
The Dow Jones Industrial Average rose 179.08 points, or 0.5 per cent, to 36,100.31. The S&P 500 gained 33.58 points, or 0.72 per cent, at 4,682.85 and the Nasdaq Composite added 156.68 points, or 1 per cent, at 15,860.96.
Ten of the 11 major sectors of the S&P 500 ended higher, with communications services’ 1.7 per cent advance leading gainers.
Energy’s 0.3 per cent dip represented the largest percentage loss.
Shares of Johnson & Johnson gained 1.2 per cent after the healthcare giant announced splitting into two companies, dividing its consumer health care segments from its pharmaceuticals/medical devices business.
Tesla dropped 2.8 per cent on news that Chief Executive Elon Musk has sold an additional $700 million in stock in the next chapter of a saga that began with Musk’s Twitter poll over whether he should offload shares in the company he founded.
Rival electric vehicle maker Rivian advanced 5.7 per cent, notching its third consecutive gain in as many days as a publicly traded company.
US-listed shares of Alibaba slipped 0.6 per cent following the e-commerce giant’s report showing its slowest-ever Singles Day sales.
Advancing issues outnumbered decliners on the NYSE by a 1.29-to-1 ratio; on Nasdaq, a 1.19-to-1 ratio favoured advancers.
The S&P 500 posted 34 new 52-week highs and one new low; the Nasdaq Composite recorded 130 new highs and 96 new lows.
Volume on US exchanges was 10.32 billion shares, compared with the 10.94 billion average over the last 20 trading days.