logo

S&P 500 closes at record high, hits 2,600 for the first time as tech rallies

Key Points
  • The Dow, S&P 500 and Nasdaq hit record highs as tech stocks rallied.
  • The Technology Select Sector exchange-traded fund (XLK), which tracks the S&P 500 tech sector, rose 1 percent to reach levels not seen since 2000.
  • Investors also cheered strong quarterly results from top companies in Corporate America.
VIDEO1:0501:05
Major market indexes rise, tech stocks rally, S&P 500 closes at record high

U.S. stocks rose to record highs on Tuesday as a rally in tech lifted the broader market. Investors also cheered strong quarterly results from top companies in Corporate America.

The gained 0.7 percent to finish at 2,599.03 — an all-time high— with information technology as the best-performing sector. The index also broke above 2,600 for the first time during the session.

The Technology Select Sector exchange-traded fund (XLK), which tracks the S&P 500 tech sector, rose 1 percent to reach levels not seen since 2000.

The Dow Jones industrial average jumped 160.50 points to close at 23,590.83, a record. Apple rose 1.9 percent and was the best-performing stock on the Dow.

The tech-heavy Nasdaq composite rose 1.1 percent to an all-time high of 6,862.48. Large-cap tech stocks like Facebook, Amazon, Netflix and Alphabet all closed higher, along with the iShares Nasdaq Biotechnology ETF (IBB).

"A lot of big tech is up big, so that's helping us here," said Dave Lutz, head of ETF trading at JonesTrading. He also noted that tech stocks may be getting a boost ahead of the holiday shopping season.

Spencer Platt | Getty Images News | Getty Images

Consumers will be hitting the stores and scouring the internet for deals as Black Friday and Cyber Monday approach.

"All eyes are on Santa as the holiday season starts up," said Terry Sandven, chief equity strategist at U.S. Bank Wealth Management. Sandven also said investors are feeling bullish heading into the earnings season as the current economic backdrop is positive for the consumer.

Investors also digested strong earnings from some of the biggest U.S. companies. Medtronic, Hormel Foods and Dollar Tree all posted better-than-expected quarterly results Tuesday before the bell, sending their stocks higher. Medtronic shares rose 4.8 percent, while Hormel and Dollar Tree advanced 3.4 percent and 2.4 percent, respectively.

"Earnings season is winding down and, when you look back, most companies have beaten expectations and that's a positive for the market," said Adam Sarhan, CEO of 50 Park Investments.

Equities built on gains made during the previous session, which arose as investors bet that tax cut would keep the current economic expansion going.

On Monday, President Donald Trump said before a cabinet meeting that his administration was going to "give the American people a huge tax cut for Christmas. "

But concerns however still linger on Wall Street, as to whether a deal will come about and be finalized by the end of the year.

Nicholas Colas, co-founder of DataTrek Research, said in a note that "if it doesn't happen soon, there may be no second chances," as Democrats could take a majority in both the House and Senate next year.

On the data front, the Chicago Fed National Activity Index rose in October. Existing home sales rose more than expected in October.

Overseas, trade in Europe ticked higher, while markets in Asia ended the session mostly higher.