Wall Street climaxes week with another record finish

PUBLISHED : Saturday, 18 February, 2017, 6:31am
UPDATED : Saturday, 18 February, 2017, 6:31am

The Dow Jones Industrial Average barely reached a seventh straight record high on Friday and the S&P 500 and Nasdaq also closed at a record as gains in Kraft Heinz helped offset selling in energy stocks.

After suffering losses for most of the session, the Dow and S&P 500 turned positive in the final minutes of a week fueled by the “Trump Rally” that has seen stocks surge since the November presidential election.

“Corporate earnings are fine, the economy’s fine, the Fed’s going to raise rates, and that’s great for financials,” said John Canally, chief economic strategist for LPL Financial.

The Dow Jones Industrial Average rose a marginal 0.02 per cent to end at 20,624.05, while the S&P 500 gained 0.17 per cent to 2,351.16. The Nasdaq Composite added 0.41 per cent to 5,838.58.

For the week, the Dow rose 1.7 per cent, the S&P 500 added 1.5 per cent and the Nasdaq gained 1.8 per cent.

Eight of the 11 major S&P sectors rose, with consumer staples adding 0.66 per cent, helped by Kraft Heinz as well as a 4.32 per cent increase in Colgate-Palmolive and a 4.19 per cent rise in Kimberly-Clark. The S&P energy sector fell 0.53 per cent as oil prices slipped.

Kraft Heinz jumped 10.74 per cent after it said it would continue to pursue a US$143 billion bid for Unilever , despite being rebuffed. Unilever’s US-listed shares surged 14.00 per cent.

Signs of a strengthening economy as well as anticipated tax cuts were behind the most recent optimism. With a strong fourth-quarter earnings season mostly complete, many investors say they need concrete signs of progress from Trump on his policy plans.

Uncertainty around other potential Trump policies is an additional risk, some investors say.

“People are focusing on only the good of what his campaign promises were,” said Lindsey Bell, an investment strategist at CFRA Research. “What makes me nervous is that it feels like the market is ignoring what could come on immigration, trade, health care - the negative implications that could come from a protectionist government.”

With a long weekend ahead due to the Presidents Day holiday on Monday, trading was a bit lighter than usual.

MSCI’s benchmark global equity index lost 0.29 per cent to 443.22 points, retreating from a record high of 444.94 on Thursday. Europe’s index of leading 300 stocks closed 0.04 per cent higher.

UnitedHealth sank 3.68 per cent after it was sued by the US Justice Department over Medicare charges.