Bank stocks push indexes to record levels
Big gains for banks and companies focused on travel helped propel US stock indexes to record levels on Tuesday.
The Dow Jones industrial average moved closer than ever to 20,000, but the symbolic threshold remained just out of reach.
Banks once again led the way as bond yields and interest rates bounced higher. Strong earnings from cruise line operator Carnival and gains for travel website TripAdvisor led consumer companies higher. Household goods makers fell after Cheerios maker General Mills cut its sales projections for the year, and energy companies fell for the second day in a row. The Dow came within 13 points of the 20,000 mark but trading remained light as the Christmas holiday approached.
Stocks have soared since the presidential election and the Dow has risen almost 1,000 points in under a month, and some investors think that means stocks won't move much in 2017.
The Dow gained 91.56 points, or 0.4%, to a record close at 19,974.62. The Standard & Poor's 500 index picked up 8.23 points, or 0.4%, to 2,270.76. The Nasdaq composite also finished at a record as it added 26.50 points, or 0.5%, to 5,483.94. The Russell 2000 index of small-company stocks jumped 12.27 points, or 0.9%, to 1,383.96.
Bond prices reversed course and fell after climbing higher Monday. The yield on the 10-year Treasury note rose to 2.56% from 2.54%. Bond yields have risen sharply of late, and that's good for banks because higher bond yields are linked to higher interest rates, which let them make more money from lending. Regions Financial rose 30 cents, or 2.1%, to 14.58 dollars and Citigroup gained 1.14 dollars, or 1.9%, to 60.80 dollars.
Cruise line operator Carnival reported profit and sales that were stronger than expected. The company said bookings for trips in 2017 are stronger than they were at this time last year. It said both ticket sales and prices are up. Carnival stock rose 1.17 dollars, or 2.3%, to 52.49 dollars and competitor Royal Caribbean gained 2.85 dollars, or 3.4%, to 85.40 dollars.
Travel website operator TripAdvisor jumped 2.34 dollars, or 5%, to 48.79 dollars after it said it will start adding some Expedia brands to its instant hotel booking platform.
Cheerios and Pillsbury roll maker General Mills cut its sales outlook for the year. The Minnesota company and many of its competitors have struggled as more Americans stay away from processed foods. Its stock lost 1.61 dollars, or 2.6%, to 61.45 dollars.
Benchmark US crude gained 11 cents to 52.23 dollars per barrel in New York. Brent crude, the international standard, jumped 43 cents to 55.35 dollars a barrel in London.
The dollar, which has been trading at 14-year highs, continued to gain strength. It climbed to 118.04 yen from 117.24 yen. The euro fell to 1.0377 dollars from 1.0404 dollars.
The CAC-40 in France rose 0.6%. Britain's FTSE 100 finished up 0.4% and the German DAX added 0.3%. Japanese stocks reached another fresh high for the year after the Bank of Japan left its current monetary policy unchanged. It said the "moderate recovery" of the world's third-largest economy was on track. The Nikkei 225 index advanced 0.5%, and South Korea's Kospi added 0.2%. Hong Kong's Hang Seng index fell 0.5%.