U.S. stocks closed mixed on Monday, after the Dow Jones industrial average hit a new all-time high, as investors evaluated the prospects of economic growth following Donald Trump's presidential election win.
"Investors clearly are optimistic because they are moving out of things that have worked great, and predictably, into things that haven't worked lately," said Kim Forrest, senior equity analyst at Fort Pitt Capital. "Investors should keep an eye out for an policy changes that may take place sooner rather than later."
The Dow gained about 20 points higher, completing a six-day winning streak and closing at a record high, with Goldman Sachs and UnitedHealth Group contributing the most gains. The S&P 500 closed around breakeven, with a 1.7 percent fall in information technology offsetting a 2 percent gain in financials. The Nasdaq composite lagged, slipping about 0.4 percent as Apple and the so-called FANG stocks (Facebook, Amazon, Netflix and Google's parent firm Alphabet) all fell.
"At this point, investors are trying to price in what's going to happen," said Bruce McCain, chief investment strategist at Key Private Bank. "I think there is a possibility for change, ... but how much he can actually do remains to be seen."
The Russell 2000, which is composed of small-cap stocks, hit its first record high since June 2015. The three major indexes traded higher earlier in the session, trying to build on strong gains made last week.
In an interview with CBS' "60 Minutes," Trump urged his supporters to stop harassing minority groups "because I'm going to bring this country together." In the same interview, however, Trump said he would deport millions of illegal immigrants.
Following Trump's victory over Democrat Hillary Clinton, investors and traders quickly honed into Trump's economic policies, which could lead to higher infrastructure spending and less regulation within financials.
"Mr Trump has delivered many water down versions of his controversial views over the weekend. This has restored further confidence that the person in charge of the biggest economy of the world, has started to think more logically," Naeem Aslam, chief market analyst at Think Markets, said in a note.
Last week was a record-setting one for the Dow, as it hit new all-time highs and posted its best weekly performance since 2011. The S&P and Nasdaq, meanwhile, posted their highest weekly gains since 2013 and February, respectively.
The rally in stocks has come simultaneously with a sharp sell-off in U.S. Treasurys, sending yields soaring. As of 4:04 p.m. ET, the two-year note yield traded at 0.996 percent, while the benchmark 10-year yield gained around 10 basis points to 2.2428 percent. The benchmark yield also hit its highest level since Dec. 31, 2015 earlier in the session.
"The recent run-up is a combination of a couple of things: partly expectations of the Federal Reserve raising interest rates and some unwinding of positions," said Robert Pavilk, chief market strategist at Boston Private Wealth. "The 10-year yield we have here, ... I think has gone a bit ahead of its self in the short-term."
He added that some investors will find Treasurys attractive, taking yields slightly lower. Pavilk also said, however, he expects higher yields in the long-term.
Meanwhile, the U.S. dollar has also soared, trading 0.98 percent higher at 100.03 against a basket of currencies. The euro fell around 1.12 percent to $1.073 and the dropped more than 1.5 percent to 108.41.
"Dollar bullish investors stole the show during trading on Monday with the Dollar Index surging to eleven-month highs at 100.00 as expectations intensified over the Federal Reserve raising US interest rates in December," Lukman Otunuga, research analyst at FXTM, said in a note. "The Dollar's appreciation was complimented with optimism towards Trump's administration bolstering spending and reviving inflation, a move seen as supporting economic growth in the States."
There are no major economic data due Monday. However, Richmond Fed President Jeffrey Lacker and San Francisco Fed President John Williams are both slated to speak Monday. Dallas Fed President Robert Kaplan said the U.S. needs "intelligent" fiscal policy to increase growth.
In oil markets, U.S. crude prices fell to settle at $43.32 per barrel, down 9 cents, as oversupply concerns loomed over the market.
Overseas, European stocks mostly rose, with the pan-European Stoxx 600 index rising 0.22 percent. In Asia, stocks closed mostly lower, with the Korean Kospi falling about half a percent and the Nikkei 225 surging 1.71 percent.
Major U.S. Indexes
The Dow Jones industrial average rose 21.03 points, or 0.11 percent, to close at 18,868.69, with UnitedHealth Group leading advancers and Visa the top decliner.
The closed 0.25 points lower, or 0.01 percent, at 2,164.20, with information technology leading six sectors lower and financials the biggest riser.
The Nasdaq composite fell 18.72 points, or 0.36 percent, closing at 5,218.4.
Advancers and decliners were about even at the New York Stock Exchange, with an exchange volume of 1.171 billion and a composite volume of 5.228 billion in at the close.
The CBOE Volatility Index (VIX), widely considered the best gauge of fear in the market, traded about 3.3 percent higher, near 14.6.
fell $2.60 to settle at $1,221.70 per ounce.
On tap this week:
Monday
1:20 p.m. Dallas Fed President Rob Kaplan
4:30 p.m. Richmond Fed President Jeffrey Lacker on panel moderated by Rick Santelli
6:30 p.m. San Francisco Fed President John Williams
Tuesday
Earnings: Home Depot, TJX Cos, Teva Pharmaceuticals, Beazer Homes, Dick's Sporting Goods, JD.com, Agilent
7:30 a.m. Boston Fed President Eric Rosengren
8:30 a.m. Retail sales
8:30 a.m. Import prices
8:30 a.m. Empire state survey
10:00 a.m. Business inventories
1:30 p.m. Fed Vice Chairman Stanley Fischer
Wednesday
Earnings: Target, Lowe's, Cisco, L Brands, Tencent, NetApp
7:45 a.m. Minneapolis Fed President Neel Kashkari
8:30 a.m. PPI
9:15 a.m. Industrial production
10:00 a.m. NAHB
4:00 p.m. TIC data
5:30 p.m. Philadelphia Fed President Patrick Harker
Thursday
Earnings: Wal-Mart, Staples, Best Buy, Applied Materials, Intuit, JM Smuckers, Salesforce.com, Gap, Manchester United, JA Solar
8:30 a.m. Initial claims
8:30 a.m. CPI
8:30 a.m. Housing starts
8:30 a.m. Philadelphia Fed survey
10 a.m. Fed Chair Janet Yellen testifies before the Joint Economic Committee of Congress on the economy
Friday
Earnings: Foot Locker, Abercrombie and Fitch, The Buckle
5:30 a.m. St. Louis Fed President James Bullard
9:30 a.m. New York Fed President William Dudley
9:30 a.m. Kansas City Fed President Esther George
1:30 p.m. Dallas Fed President Rob Kaplan