US STOCKS-Wall St hits record highs on strong technology, health stocks


Reuters

* Fed's Dudley says tight labor market should push inflation
up
    * Biogen, Clovis boost healthcare indexes
    * Investors flood back to technology
    * Indexes up: Dow 0.68 pct, S&P 0.83 pct, Nasdaq 1.4 pct

 (Updates with closing prices, adds commentary, volume)
    By Sinead CarewNEW YORK, June 19 (Reuters) - U.S. stocks rose on Monday,
with the S&P 500 and the Dow  hitting record highs with growth
sectors such as technology in favor again as investors appeared
to regain confidence in the economy after upbeat comments from
Federal Reserve officials.
    Nasdaq's biotechnology index <.NBI> rose 2.5 percent in its
biggest one-day gain since February while the S&P's healthcare
index <.SPXHC> had a record-high close. [nL1N1JG121]
    Amazon.com's <AMZN.O> Friday announcement that it would buy
Whole Foods <WFM.O> and an upbeat tone from Federal Reserve
speakers seemed to help reassure investors after the U.S.
central bank's rate hike last week, according to J. Bryant
Evans, portfolio manager at Cozad Asset Management, in
Champaign, Illinois.
    "It looks like a bet that interest rates, such as the
10-year yield, are bottoming out," said Evans. "It's a
resumption of this idea that the economy is in decent shape."
    He added that a "push in M&A tends to propel the market" and
that the Amazon/Whole foods $13.7 billion deal was a "tangible
sign the mergers and acquisition environment is pretty good
right now."
    The Dow Jones Industrial Average <.DJI> rose 144.71 points,
or 0.68 percent, to end at 21,528.99, the S&P 500 <.SPX> gained
20.31 points, or 0.83 percent, to 2,453.46 and the Nasdaq
Composite <.IXIC> rose 87.26 points, or 1.42 percent, to
6,239.01.
    The S&P's financial sector <.SPSY> was also one of the
benchmark's strongest gainers with a 0.98 percent rise after New
York Federal Reserve President William Dudley said U.S.
inflation was a bit low but should rise alongside wages as the
labor market continues to improve, allowing the Fed to continue
gradually tightening monetary policy. [nN9N1GG012]
    The Fed commentary last week had surprised investors who
expected more caution after some weak U.S. economic data.
    "My sense is investors must be looking at this as a
pro-growth belief that perhaps Dudley sees underlying strength
in the economy that the data doesn't show right now. The Fed's
base case is that this is just kind of a soft patch and we will
continue to cycle higher," said Jack Ablin, chief investment
officer at BMO Private Bank in Chicago.
    The S&P technology sector <.SPLRCT> finished up 1.7 percent
after its second straight weekly decline, which was triggered by
fears of stretched valuations. Tech stocks have led the S&P
500's 9.6 percent rally this year.
    "Investors were temporarily chased from the space but many
companies in the sector offer growth which is difficult to find
in the market as a whole," said Mark Luschini, chief investment
strategist at Janney Montgomery Scott in Philadelphia.
    Apple <AAPL.O> rose 2.9 percent to $146.34, providing the
biggest boost to the S&P followed by JPMorgan Chase <JPM.N>,
which rose 2.2 percent to $88.07.
    The S&P 500 bank subsector <.SPXBK> rose 1.3 percent.
    The two biggest boosts for the biotechnology index were
Biogen Inc <BIIB.O> and Clovis Oncology <CLVS.O> [nL1N1JG121]
    Biogen ended up 3.5 percent to $260.54, after it was
upgraded to "neutral" from "sell" at UBS.
    Shares of Clovis Oncology soared 46.5 percent to $87.88
after late-stage data on its ovarian cancer drug. [nL3N1JG2TI]
    Advancing issues outnumbered declining ones on the NYSE by a
1.76-to-1 ratio; on Nasdaq, a 2.01-to-1 ratio favored advancers.
    The S&P 500 posted 49 new 52-week highs and 10 new lows; the
Nasdaq Composite recorded 99 new highs and 87 new lows.
    About 6.3 billion shares changed hands on U.S. exchanges
compared with the 6.8 billion average for the last 20 sessions.

 (Additional reporting by Tanya Agrawal, Chuck Mikolajczak and
Lewis Krauskopf; Editing by James Dalgleish)
 ((sinead.carew@thomsonreuters.com; +1)(646)(223 6186; Reuters
Messaging: sinead.carew.thomsonreuters.com@reuters.net))

Keywords: USA STOCKS/ (UPDATE 6)



This article appears in: World Markets , US Markets , Stocks
Referenced Symbols: AAPL , AMZN , BIIB , CLVS , JPM


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