Stocks close at record highs before Christmas break
Dec. 24, 2013 at 9:59 AM ET
John Moore / Getty Images
Lights for the holidays illuminate the New York Stock Exchange. The Dow Jones Industrial Average closed at a record high Tuesday in holiday-shortened trade. U.S. markets will be closed Wednesday to observe the Christmas holiday.
U.S. stocks rose on Tuesday, with the Dow industrials again notching record closes, as better-than-expected data bolstered optimism about the economic outlook.
“It has become clearer that 2013 for the U.S. equity markets was all about where can I place my money to make a decent return, and I think a lot of people ended up chasing the market and pushing it higher. It was the least worst house on a bad block,” said Robert Pavlik, chief market strategist at Banyan Partners, contrasting the U.S. market to those in Asia, Europe and emerging markets.
“And, when interest rates started to tick up on Treasuries, equities seemed like the only game in town. That and the fact that the Fed continues to print money and provide a low cost of capital environment for corporate America,” Pavlik added.
The U.S. stock market closed at 1 p.m. Tuesday ahead of Wednesday’s Christmas holiday.
The Dow Jones Industrial Average gained, with 22 of its 30 components rising.
Johnson & Johnson edged lower. Reuters cited people familiar with the matter in reporting private-equity firm Carlyle Group was close to a deal to buy the company’s ortho clinical diagnostics business in a deal that could be worth about $4 billion.
The S&P 500 also advanced, with materials and telecommunications the best performing of its 10 major sectors.
Tesla Motors climbed after the electric-car maker said the National Highway Traffic Safety Administration had reaffirmed the safety rating for its Model S Sedan.
The Nasdaq rose, with the technology-heavy index up nearly 38 percent for the year.
The dollar gained against the currencies of U.S. trading partners and Treasury prices fell, with the yield on the 10-year note rising 4 basis points to 2.97 percent.
On the New York Mercantile Exchange, crude futures for February delivery added 25 cents to $99.16 a barrel and gold futures for February delivery advanced $4.40 to $1,201.40 an ounce.
Orders for goods intended to last at least three years increased 3.5 percent in November after a 0.7 percent decline the prior month. Consensus estimates called for a 2 percent rise.
New home sales fell 2.1 percent in November to 464,000 versus a 445,000 estimate.
“New home sales beat expectations and the prior month was revised higher. That’s a good sign, housing may see a delayed but more positive reaction as we move through the new year. People are going to get a little freaked out about interest rates, but with higher rates prices come down a little bit, and eventually more people qualify for loans because banks want to make the loans,” said Pavlik.
Data from the Federal Housing Finance Agency had home prices rising 0.5 percent in October from September, and up 8.2 percent from a year earlier.
On Monday, stocks advanced as Apple and Facebook led a rally in the technology sector and data had consumer sentiment at a five-month high and spending rising in November.
—By CNBC’s Kate Gibson
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