Stocks hold altitude at record highs

optionMONSTER

Stocks are inching higher this morning after closing at another record high yesterday.

S&P 500 futures are up more than 0.1 percent, while most European markets are up more than 0.5 percent. China rallied more than 1 percent overnight after Beijing said the economy grew more than expected this year. The country's market had touched a four-month low earlier in the week on worries about looming debt maturities.

The S&P 500 has closed at record levels in five of the last six sessions, lifted by an improving economy and ample cash on the sidelines. Volume has waned during the holidays, so the big questions now facing investors are whether stocks will continue to drift higher, and when profit taking will occur. The next important economic news comes on Jan. 2, when China, Europe and the United States release key manufacturing data.

Today's gains overseas result from continued weakness in the Japanese yen and a cabinet report that China's economy will grow 7.6 percent this year, slightly above its earlier 7.5 percent estimate.

Our researchLAB scanning tool has shown broad strength across the market, although sentiment has recently shifted in favor of economically sensitive areas such as industrials, materials and technology. Homebuilders and ocean-shipping companies have also stood out in the last week.

In company-specific news, Textron is indicated higher by 4 percent after agreeing to purchase closely held Beechcraft for $1.4 billion. Social-media stock Twitter is also likely to be active after surging to a record high yesterday amid heavy option volume . TWTR has almost tripled from its initial public offering.

Foreign-exchange trading it bullish today, with the euro higher and the Japanese yen down across the board. Commodities paint a more cautious tone as copper and precious metals edge lower and oil is little changed. Natural gas dropped more than 1 percent.

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