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Stock Market News For Jul 10, 2018

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Wall Street witnessed a strong broad-based rally on Monday. All three major indexes closed sharply higher on the first trading day of the week, reflecting three straight sessions of gains.  A series of robust job data diminished investor’s concerns about a full-fledged trade war.

The Dow and S&P 500 recorded their biggest gains in more than a month. Moreover, market participants are looking for a solid second-quarter earnings season which will be kicked off later this week. Financials and industrials sectors took the leading part on Monday’s broad-based stock rally.

The Dow Jones Industrial Average (DJI) closed at 24,776.59, jumped 1.3% or 320.11 points. The S&P 500 Index (INX) increased 0.9% to close at 2,784.17. The Nasdaq Composite Index (IXIC) closed at 7,756.20, gaining 0.9%. A total of 6 billion shares were traded on Monday, lower than the last 20-session average of 7 billion shares. Advancers outnumbered decliners on the NYSE by 1.77-to-1 ratio. On the Nasdaq, advancers had an edge over decliners by 1.65-to-1 ratio.  The CBOE VIX decreased 5.1% to close at 12.69.

How Did the Benchmarks Perform?

The Dow surged 1.3% which helped the blue-chip index to return to positive territory for 2018. Moreover, the index also closed above its 50-day moving average – a psychological barrier for short-term momentum trend – for the first time since Jun 20. Notably, 25 of the 30-stock index closed in the green while 5 traded in the red.

The S&P 500 was up 0.9% led by 2.3% increase in Financials Select Sector SPDR (XLF), 1.9% rise in Industrials Select Sector SPDR (XLI), 1.5% gain in Energy Select Sector SPDR (XLE) and 1.2% rise in Consumer Discretionary Select Sector SPDR (XLY), partially offset by 3.1% decline in Utilities Select Sector SPDR (XLU). Notably, eight out of 11 sectors of the benchmark index ended in positive territory.

Likewise, the tech-heavy Nasdaq Composite gained 0.9% due to strong showing by the large-cap tech stocks.

Financial and Industrial Sectors Lead Market Rally

Financial and industrial stocks rally significantly on Monday, which led to a broad-based market rally. Notably, both financials and industrials sector gained as investor shrugged off trade war fear buoyed by strong economic data. Friday’s job market data reduces concerns that United States is in the late stage of economic expansion.

Moreover, ISM manufacturing and services data for June and Commerce Department’s encouraging data on U.S. trade deficit in May as well as strong consumer credit data for May released by the Fed raised investor’s appetite for riskier assets like equities.

Financial stocks were also benefitted from rising yield on benchmark 10-year Treasury Notes. The yield raised 3.6 basis points to 2.87%. Financials Select Sector SPDR (XLF) witnessed its biggest one-day percentage gain since Jun 6.

Share prices of major banks such as JPMorgan Chase & Co. JPM, Citigroup Inc. C, The Goldman Sachs Group Inc. GS and Bank of America Corp. BAC increased 3.1%, 2.7%. 2.8% and 3.6%, respectively.

Likewise, share prices of large industrial companies like Caterpillar Inc. CAT and The Boeing Co. BA increased 4.1% and 2.2%, respectively. The Boeing sports a Zacks Rank #1 (Strong Buy). You can seethe complete list of today’s Zacks #1 Rank stocks here.

Economic Data

The Federal Reserve reported that total consumer credit increased $24.6 billion in May to a seasonally adjusted $3.9 trillion. This reflects a year-over-year growth of 7.6%, the fastest growth rate since November. April’s reading has been revised to $10.3 billion from $9.3 billion reported earlier. April and May data indicate strong consumer spending in the second quarter of 2018.

Stocks That Made Headlines

ExxonMobil Awaits Government's Nod for Rovuma LNG Project

Exxon Mobil Corp. XOM along with partners has submitted development plan for the first phase of the Rovuma LNG project to the government of Mozambique. (Read More)

Eni Discovers Light Oil the Second Time in South West Meleiha

Eni SpA E hit light oil on the B1-X exploration prospect located in South West Meleiha license, in the Egyptian Western Desert, about 130 kilometer north of the oasis of Siwa. (Read More)

The Hottest Tech Mega-Trend of All

Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.