The S&P 500 ended the week at record high on Friday, lifted by Nike and several banks, while weaker-than-expected inflation data eased worries about a sudden tapering in stimulus by the Federal Reserve. The TSX closed higher, coming within only about one point of its own record, as oil prices climbed to their highest since October 2018.
The S&P/TSX Composite Index finished at 20,230.26, up 15.14 points or 0.07% - bringing its advance for the week to 1.1%. The benchmark Canadian index closed at an all-time high of 20,231.32 on Jun 15.
The TSX energy and financial sectors both had strong sessions, gaining 0.24% and 0.48%, respectively. The tech sector had a relatively weak session, mostly due to a 4.54% slide in shares of BlackBerry. Investors were largely unimpressed with its earnings released late Thursday, with at least two analysts downgrading the stock to a sell recommendation - though that was mostly due to valuation concerns after its recent runup in price.
On Wall Street, Nike Inc surged 15.5% to an all-time high after the sneaker maker forecast fiscal full-year sales ahead of Wall Street estimates, helping the Dow lead among the three main indexes.
Bank of America climbed 1.9% and Wells Fargo rallied 2.7% after the Fed announced big banks have cleared its stress test and will no longer face pandemic-related restrictions on buying back stock and paying dividends.
The S&P 500 financials index rose 1.3% and was the top performer among 11 sector indexes.
“Today is a bit of profit-taking in tech and a reallocation into the banks after the results of the stress tests,” said Dennis Dick, a proprietary trader at Bright Trading LLC, adding he expects banks to soon announce increased dividends.
A bipartisan Senate deal on infrastructure spending embraced by U.S. President Joe Biden on Thursday continued to lift stocks, with the materials and industrials indexes increasing and helping the S&P 500 outperform the Nasdaq.
“The positive news from the infrastructure package favors the S&P 500 more than then Nasdaq. The Nasdaq does not pour cement into roads and put steel in bridges. That’s the S&P 500,” said Jake Dollarhide, chief executive officer of Longbow Asset Management in Tulsa, Oklahoma.
The latest personal consumption expenditures (PCE) data showed a measure of underlying inflation rose less than expected in May. Core PCE rose 3.4% year-over-year as expected, above the Fed’s 2% flexible target.
Billionaire Richard Branson’s spaceship company Virgin Galactic soared almost 40% and was Wall Street’s second most traded company after receiving approval from the U.S. aviation safety regulator to fly people to space.
With the FTSE Russell reconstituting its indexes following a wild trading year marked by the pandemic and “meme” stocks, volume on U.S. exchanges surged to 15.1 billion shares, versus the 11.2 billion average over the last 20 trading days.
The Dow Jones Industrial Average rose 0.69% to end at 34,433.84 points, while the S&P 500 gained 0.33% to 4,280.69.
The Nasdaq Composite dropped 0.06%, to 14,360.39.
For the week, the S&P 500 gained 2.7%, the Dow added 3.4% and the Nasdaq gained 2.4%. It was the S&P 500′s strongest week since early February and the Nasdaq’s strongest since April.
Advancing issues outnumbered declining ones on the NYSE by a 1.29-to-1 ratio; on Nasdaq, a 1.22-to-1 ratio favored advancers. The S&P 500 posted 32 new 52-week highs and no new lows; the Nasdaq Composite recorded 149 new highs and 14 new lows.
Oil prices were up for a fifth week in a row on expectations demand growth will outstrip supply and OPEC+ will be cautious in returning more crude to the market from August.
Brent futures rose 62 cents, or 0.8%, to settle at US$76.18 a barrel, while U.S. West Texas Intermediate (WTI) crude rose 75 cents, or 1.0%, to $74.05.
Those were the highest closes for both benchmarks since October 2018 and put both contracts up over 3% for the week.
Read more: Stocks that saw action Friday - and why
With files from Reuters