Dow breaks above 19,000

Wall Street's three main indices hit records again on Tuesday, with the Dow topping 19,000 points for the first time ever, closing at
19,023 points on Tuesday. Earlier in the day it reached its all time record of 19,043 points, as investors awaited housing data and kept an eye on President-elect Donald Trump's policy agenda. The Dow, S&P 500, Nasdaq and small-cap Russell 2000 indices had all closed at record highs on Monday, too. It was the first time since December 1999 that all three indices hit all-time highs simultaneously.

Trump's promises of tax cuts, higher spending on infrastructure, and less regulation in the banking and healthcare industries have led a rally, especially in the latter two sectors, since the election on Nov. 8.

Bruce Bittles, chief investment strategist at Baird, noted that before the US election, stock markets had been in a three-month period of consolidation. He said the rally was just the beginning.

"We are in a transition period on a number of fronts. First, we're moving from an interest-rate driven market into an earnings-driven market," he said. "Also, something most people are missing is, we're getting a more business-friendly administration."

Katie Stockton, chief technical strategist at BTIG, said in a note to investors that the current momentum in stock markets was proving strong enough to "overrule overbought conditions, so we think it is appropriate to be buying breakouts."

And Robert Pavlik, chief market strategist at Boston Private Wealth in New York told the news agency Reuters that the rally had been broad-based across all sectors, which was "a positive sign" for the markets: "Optimism is returning because of the potential that exists in the form of fiscal stimulus, infrastructure spending, and tax cuts, and is renewing confidence on the part of investors and consumers."

Advances in all sectors

The energy index jumped 2.2 percent, leading gains among major S&P sectors, as US oil prices climbed 3.9 percent. Hopes that OPEC would agree to an output cut next week lifted oil prices. The S&P materials index was up 1.3 percent.

During the regular session, the technology index, which had underperformed other sectors following the election, was up 1.1 percent. Facebook shot up 4.1 percent, giving the Nasdaq its biggest boost, after the company announced a $6-billion share buyback program late Friday.

Tech deals also boosted sentiment in the sector and the broader market. LifeLock surged 14.7 percent after Symantec said it would buy the identity theft protection company for $2.3 billion. Symantec rose 3.2 percent. Applied Micro Circuits jumped 11.7 percent after Macom Tech said it would buy its fellow chipmaker for $770 million. Macom was off 4.1 percent.

According to Thomson Reuters data, about 6.7 billion shares changed hands on US exchanges, below the 8.1 billion daily average for the past 20 trading days.

However, data from TrimTabs Investment Research showed investors moved $45.7 billion into US-listed equity exchange-traded funds in the eight trading days ended Thursday, the biggest eight-session inflow on record.

Bucky Hellwig, senior vice president at BB&T Wealth Management in Birmingham, Alabama, said that expectations Trump would ease regulations and reduce taxes would keep pulling money into the market. "A lot of money came out of bond funds last week into stocks, and I think that can continue given the potential spread between what stocks can do versus bonds."

The Dow took 121 days, or about five months, to move to 18,000 points from 17,000 points, but has since crawled along. The index took another 483 days, or roughly two years, to breach 19,000 points.

uhe/nz (Reuters, AFP, dpa)