Dow closes at record high as Street cheers strong earnings season

31.07.2017 / 23:18

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The Dow Jones industrial average closed at a record high on Monday as Wall Street cheered on what's been a strong earnings season.

The 30-stock index rose about 60 points with Goldman Sachs and Home Depot contributing the most gains. Boeing also contributed gains, with shares rising half a percent after announcing it expects a record number of aircraft orders from India. The announcement came about a week after posted better-than-expected quarterly results.

The S&P 500 closed slightly lower as materials and information technology lagged. The Nasdaq composite underperformed, falling 0.42 percent as large-cap tech stocks like Facebook and Alphabet pulled back.

"What's driving this market in the short term is earnings," said Atul Lele, chief investment officer at Deltec International Group. "Earnings are being driven by the recent economic expansion, which we think still has room to run."

This earnings season has largely provided positive surprises for investors. Seventy-three percent of the S&P 500 companies that had reported as of Friday had topped estimates on both the top and bottom lines, according to data from FactSet.

These results, along with stabilizing oil prices and persistently subdued sovereign bond yields, have allowed the stock market to keep notching record highs, said Peter Cardillo, chief market economist at First Standard Financial.

"We keep seeing political and geopolitical tension creeping up and the market seems to be taking that in stride," Cardillo said.

In other corporate news, Discovery Communications agreed to buy Scripps Networks for $14.6 billion in cash and stock, or $90 per share. Thanks to the deal, July became the best month of the year for M&A activity, according to Richard Peterson of S&P Global Market Intelligence. That said, year-on-year value has fallen 15 percent.

Source: Bloomberg Pro Terminal

Jr Trader Alexander Kumanov

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Dow closes at record high as Street cheers strong earnings season

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