U.S. stocks ended sharply higher on Thursday, with the S&P 500 and Nasdaq finishing at record highs after President Joe Biden said that he has struck an infrastructure deal with a bipartisan group of lawyers. All the three major indexes ended in positive territory.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) climbed 1% or 322.58 points to finish at 34,196.82 points, snapping its two-day winning streak. The blue chip index is just 2.6% away from its all-time high.
The S&P 500 gained 0.6% or 24.65 points to end at 4,266.49 points, surpassing its previous all-time closing high of 4,255.15 points recorded on Jun 14. The benchmark has now paired last week’s losses triggered by the Fed’s meeting.
The rally was driven by financials, energy and communication services stocks. The Financials Select Sector SPDR (XLF) advanced 1.3%, while the Energy Select Sector SPDR (XLE) and Communication Services Select Sector SPDR (XLC) each gained 0.9%. Nine of the 11 sectors of the benchmark index closed in positive territory.
The tech-heavy Nasdaq advanced 0.7% or 97.98 points to end at 14,369.71 points, registering its 17th record close of 2021. Shares of Tesla, Inc.
TSLA
increased 3.5%, while Caterpillar, Inc.
CAT
gained 2.6%%. Tesla carries a Zacks Rank #3 (Hold). You can see
the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here
.
The fear-gauge CBOE Volatility Index (VIX) was down 2.14% to 15.97. A total of 9.2 billion shares were traded on Thursday, lower than the last 20-session average of 11 billion. Advancers outnumbered decliners on the NYSE by a 2.29-to-1 ratio. On Nasdaq, a 2.44-to-1 ratio favored advancing issues.
Infrastructure Deal Lifts Investors’ Sentiment
Stocks didn’t much of a movement on Wednesday after rallying in the earlier two sessions as investors worried about inflation and that the Fed would hike interest rates sooner than expected despite Fed Chair Jerome Powell’s dovish talks.
However, Thursday spirits were high after Biden announced that the White House has struck an infrastructure deal with a bipartisan group of senators. The White House said that the deal will include $579 billion in new spending. Republicans have been opposing Biden’s proposal to raise the corporate tax rate to 28% from 21%.
The announcement lifted investors’ sentiment, with the Dow hitting new session highs. The S&P 500 industrial and material stocks that are seen sensitive to infrastructure spending also rallied on the news.
Economic Data
In economic data released on Thursday, durable goods orders rose 2.3% in May. However, orders for core capital goods declined 0.1% in May.
Advanced trade deficit in goods increased to $88.1 billion in May from $85.7 in the earlier month. Also, the Commerce Department left the revised estimate of the first-quarter GDP growth unaltered at an annual rate of 6.4%.
Infrastructure Stock Boom to Sweep America
A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made.
The only question is “Will you get into the right stocks early when their growth potential is greatest?”
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