By Dan Strumpf
Stocks extended their record-setting rally into Monday, as
investors continued to digest upbeat economic data and improving
corporate profits.
The Dow Jones Industrial Average recently rose 27 points, or
0.2%, to 17601, marking its fifth-straight session of gains.
Earlier in the day, the blue-chip index leapt to an intraday record
of 17618.46, reversing a modest loss at the open. The S&P 500
also notched an intraday high, recently advancing five points, or
0.2%, to 2037, in its fourth day of gains.
The Nasdaq Composite Index added 13 points, or 0.3%, to
4646.
Traders reported a quiet session with restrained buying
following Friday's jobs report, which showed that U.S. employers
added jobs at a moderate pace for another month in October. The
report lifted the Dow Industrials and the S&P 500 to record
closes. For the year, the Dow has notched 22 records and the
S&P has ended at 38 closing highs, gains that investors widely
attribute to the Federal Reserve's easy-money policies and a slow
but steadily improving economy.
"There's a lot of international headlines blowing around, but I
think the U.S. market is still digesting the Friday jobs report,"
said Tom Carter, a managing director and trader at brokerage
JonesTrading. "Market sentiment remains positive overall."
Investors in the coming months are expected to keep a close eye
on the Federal Reserve, where officials are set to continue their
debate on when to lift short-term interest rates, which have been
near zero since December 2008. Many investors said that October's
jobs report did little to shift their perception of when the
interest-rate increase will occur, expected some time next
year.
Jack McIntyre, senior research analyst at Brandywine Global,
which manages about $60 billion, said he expects risky assets like
stocks to continue to benefit even as the Fed raises rates, given
recent steps toward looser monetary policy by central banks in
Europe and Japan.
"Even with the Fed ending quantitative easing and nudging
interest rates higher next year, the financial markets are going to
have this tailwind of more-than-adequate monetary policy," he said.
"That should set a good backdrop for risk assets."
Crude-oil futures recently retreated 1.5% to $77.45, reversing
early gains and extending their four-month slide. The decline has
dented energy stocks and led investors to reassess the implications
of cheaper oil on corporate outlooks. Oil stocks fell, with shares
of Chevron down 0.7% and Exxon Mobil easing 0.1%.
Chinese shares posted their biggest daily percentage gain since
July after Chinese regulators said Shanghai's stock market would
open up to overseas investors on Nov. 17, through the launch of a
trading link between Hong Kong and Shanghai.
The Stoxx Europe 600 rose 0.7%. Two million Catalans voted in
favor of independence from Spain on Sunday in a symbolic,
nonbinding exercise. In September, Scottish voters voted against
separating from the U.K.
In commodities markets, gold futures fell 0.9% to $1158.70 an
ounce.
No major economic-data reports are scheduled for release Monday.
Later in the week, investors will get a reading on retail sales in
October and a preliminary gauge of consumer sentiment in
November.
Though the bulk of the third-quarter earnings season is over,
quarterly reports of note this week include retailers such as
Macy's Inc. and Wal-Mart Stores Inc. Companies in the S&P 500
are on track to post earnings growth of 8% in the third quarter,
according to FactSet.
Katrina Lamb, head of investment strategy and research at MV
Financial, which manages about $500 million, said she is looking
ahead to the coming holiday sales season to help guide stocks
through the end of the year.
"You've got a good economic story here in the U.S.," Ms. Lamb
said. "In the absence of anything negative, you could look for
something positive in holiday sales."
In corporate news, home builder Toll Brothers Inc. said
preliminary revenue in the quarter ended Oct. 31 rose 29% to $1.35
billion, topping expectations. Shares rose 3.5%.
Shares of GoPro Inc. fell 3.3%. The maker of portable cameras
filed plans Monday for an offering of $800 million in shares after
raising $491 million in its initial public offering in June.
The yield on the benchmark 10-year Treasury note edged higher to
2.349%.
Write to Dan Strumpf at daniel.strumpf@wsj.com