US Markets

Dow notches 5-day winning streak as stocks close at record highs

Key Points
  • The Dow Jones industrial average posted a five-day winning streak as stocks built on gains from the previous session.
  • The major indexes also managed to post intraday records.
Dow notches 5-day winning streak as stocks close at record highs

U.S. stocks closed higher on Tuesday, building on strong gains from their previous session.

The Dow Jones industrial average rose 84.07 points to 22,641.67, setting intraday and closing records, with 3M contributing the most to the gains. The 30-stock index also posted a five-day winning streak.

The finished 0.2 percent higher at 2,534.58 and notched a record close; it also rose for the sixth straight session. Airline stocks Delta and United Continental were the best performers in the S&P, advancing 6.6 percent and 6.1 percent, respectively.

The Nasdaq composite advanced 0.2 percent to close at 6,531.71, and also hit a record high.

Major U.S. Indexes

"I think this rally is probably going to extend itself," said Peter Cardillo, chief market economist at First Standard Financial. "There are a lot of challenging factors out there, but equities seem to brush that aside."

"If we have a positive week, that could set the tone for what we could see the rest of the year," Cardillo said.

Traders work on the floor of the New York Stock Exchange (NYSE) in New York.
Brendan McDermid | Reuters

Stocks posted record highs across the board on Monday, led by strong gains in health care and financials.

"I think the market is expecting a benign environment with interest rates where they are at," said Bob Phillips, managing principal at Spectrum Management Group. "Tax reform is still in the air, ... so that's helping keep a floor on stocks."

While some Wall Street experts have expressed concern over equity valuations, billionaire Warren Buffett said they made sense given where interest rate are. Buffett said rates have been a "powerful factor" in equity values.

The Federal Reserve has raised interest rates twice this year, with investors largely expecting a third rate hike in December, according to the CME Group's FedWatch tool.

The central bank "has somewhat of a reputation as the matador that dispatches bull markets with the sword of policy mistakes," said Nicholas Colas, co-founder of DataTrek Research, in a note to clients. Colas added, however, he does not see this happening. "Short-term rates are still very low by historical standards. And long-term rates seem fine with the Fed's stated balance sheet reduction goals."

Treasury yields fell on Tuesday. The short-term two-year yield slipped to 1.47 percent, while the benchmark 10-year yield fell to 2.33 percent.

In economic news, monthly auto sales data were being released throughout the day. General Motors, Ford, and Fiat Chrysler were among the automakers who reported better-than-expected sales.