S&P 500 and Nasdaq ride slight gains to first back-to-back records since August

S&P 500 and Nasdaq ride slight gains to first back-to-back records since August

Spotify shares finished flat after first-quarter results

The S&P 500 and the Nasdaq posted fresh all-time highs Monday as Wall Street kicked off one of the busier periods of quarterly earnings season, and as investors awaited a policy update from the Federal Reserve.

What are indexes doing?

The Dow Jones Industrial Average DJIA, +0.04% rose 11.06 points, or less than 0.1%, to end at 26,554.39, while the S&P 500 index SPX, +0.11% rose climbed 3.15 points, or 0.1%, to 2,943.03, ending off its best level of the session but surpassing an intraday record of 2,940.91, set Sept. 21, which some market technicians view as a constructive development. The Nasdaq Composite Index COMP, +0.19% rose 15.46 points to 8,161.85, a gain of 0.2%.

Both the S&P 500 and Nasdaq posted back-to-back record closes, marking the first consecutive record finishes for the indexes since a four-day streak ended Aug. 29, according to Dow Jones Market Data.

What’s driving the market?

Earnings season continues, with 164 S&P 500 companies, including five Dow components, set to report first-quarter results in the week ahead, according to FactSet data. Through the end of last week, 46% of companies reported.

Federal Reserve policy makers are fully expected to leave interest rates on hold when they conclude a two-day meeting on Wednesday. But the statement and Chairman Jerome Powell’s remarks will be closely watched for clues to their thinking.

Some investors continue to look for the Fed to cut rates before the end of the year, even after data Friday showed the U.S. economy started 2019 on a stronger-than-expected footing. That is because underlying components of the report on first-quarter gross domestic product appeared less impressive and, moreover, due to continued signs that inflation remains subdued, like a Monday reading of PCE inflation that showed prices rising at an annual rate of 1.6% in March, below last month’s reading and the Fed’s 2% target.

The government’s estimate of April jobs growth is due on Friday.

U.S.-China trade talks are scheduled to resume in Beijing this week, with U.S. Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin set to meet Tuesday with Chinese Vice Premier Liu He.

Meanwhile, The Wall Street Journal reported that President Donald Trump’s attempt to revamp North America’s trade rules is hitting a roadblock in Washington, with Democrats and labor groups demanding changes that dim the chances of ratifying a new agreement with Canada and Mexico before next year’s presidential election.

What stocks are in focus?

Anadarko Petroleum Corp. APC, +0.88%  said Monday it intends to resume talkswith Occidental Petroleum Corp. OXY, +4.47%  regarding its bid to acquire the company, which came after an earlier merger agreement with major oil producer Chevron Corp. CVX, +2.29%

Anadarko shares rose 0.2% Monday, while Occidental shares fell 1.9% and Chevron shares edged up 0.5%.

Shares of Dow component Boeing Co. BA, -0.11%  were in focus after The Wall Street Journal reported the plane maker didn’t tell Southwest Airlines Co.LUV, +1.60%  when the company began flying 737 MAX jets in 2017 that a safety feature designed to warn pilots about malfunctioning sensors had been deactivated. Boeing shares fell 0.5% Monday.

Shares of Dow component Walt Disney Co. DIS, -0.27%  slipped 0.4% Monday, reversing premarket gains that accrued after “Avengers: Endgame,” from the entertainment giant’s Marvel Studios, crushed box-office records in its opening weekend, with an estimated $350 million in domestic ticket sales and $1.2 billion in global sales.

Spotify Technology SA SPOT, -0.08% reported first-quarter earnings Monday morning, with revenue and subscriber growth surpassing Wall Street expectations. The company’s stock fell less than 0.1% Monday.

Shares of Restaurant Brands Inc. QSR, -1.44% retreated 1.4% Monday, after the Burger King parent reported first-quarter profit that fell below expectations, though revenue was in line.

Shares of Google parent Alphabet Inc. GOOG, -8.05% rose 1.2% as the internet giant prepared to issue its first-quarter earnings report after the close of trade Monday.

What are the analysts saying?

“Personal spending data came in strong, which gave markets a boost,” Randy Frederick, vice president. of trading and derivatives at Charles Schwab, told MarketWatch. “Earnings have been better than expected overall, and the earnings recession many feared looks like it won’t happen.”

“There’s no bad news right now, “ he added. “The market is in a clear up momentum, and a lack of bad news and upward momentum pushes things higher.”

What’s on the economic calendar?

Consumer spending rose 0.9% in March, above economists expectations of a 0.8% rise, per a MarketWatch poll, and the largest monthly rise in nearly 10 years. The Commerce Department also indicated that personal incomes rose 0.1%, below expectations of 0.4% growth.

How are other markets trading?

Asian markets closed mixed Monday, with Hong Kong’s Hang Seng IndexHSI, -0.65% adding 1%, while China’s Shanghai Composite IndexSHCOMP, +0.52% and the Shenzhen Composite index 399106, +0.68% both losing ground. Meanwhile, China’s CSI 300 000300, +0.33%  gained 0.3%. In Europe, stocks closed mostly higher, with the Stoxx Europe 600 SXXP, -0.13% up 0.1%

In commodities markets, the price of oil CLM9, +1.84% finished mixed, while the value of gold GCM9, +0.14% registered their first loss in four sessions. The U.S. dollar DXY, -0.33% meanwhile, edged slightly lower.

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