Tech Shares Drive U.S. Stock Indexes Higher

01/02/18 01:28 PM EST
By Christopher Whittall and Akane Otani 

Rallying technology shares pushed major U.S. stock indexes higher in the first trading session of 2018.

After a banner year for markets around the world, many investors say they are optimistic that the long U.S. stock rally can continue in the year ahead.

Firming global growth and solid corporate earnings have helped lift stocks to fresh highs, even as some investors have grown nervous over the length of the rally.

That backdrop should help major indexes keep rising in 2018, many investors and analysts say, although some expect stock gains to slow in the coming year.

"We'd expect the global expansion to continue and drive equities to new highs in the process," said Shoqat Bunglawala, head of the global portfolio solutions group for EMEA at Goldman Sachs Asset Management, who added that he expects gains to be punctuated with short periods of volatility as the Federal Reserve continues to raise interest rates.

The Dow Jones Industrial Average climbed 39 points, or 0.2%, to 24757 on Tuesday after notching its second biggest yearly gain of the past decade in 2017. The S&P 500 rose 0.6% and the Nasdaq Composite added 1.2%.

Shares of technology companies jumped Tuesday, reversing course after sliding in the last trading session of 2017. Alphabet shares jumped 1.8% while Activision Blizzard added 1.3%.

Government bonds and their stock-market proxies pulled back.

The yield on the benchmark 10-year U.S. Treasury note rose to 2.476%, according to Tradeweb, compared with 2.409% on Friday. Yields rise as bond prices fall.

Shares of utilities companies, which many investors consider bondlike because of their hefty dividends, fell 1% in the S&P 500, among the biggest decliners of the broad index's 11 sectors.

Meanwhile, analyst upgrades helped push shares of consumer-discretionary companies higher.

Nordstrom jumped 3.9% after J.P. Morgan analysts upgraded their rating for the stock to neutral from underweight, while Netflix climbed 4.7% after Macquarie bumped up its rating for the stock to outperform from neutral.

Elsewhere, the Stoxx Europe 600 edged down 0.2%, weighed down by declines in real-estate stocks.

Hong Kong's Hang Seng Index rose 2%, thanks in part to advances in shares of Chinese messaging-and-gaming heavyweight Tencent Holdings.

Solid Chinese manufacturing data showed the technology sector remained healthy, said Krystal Tan of Capital Economics. Global economic growth "and accommodative domestic monetary policy should help keep Asian manufacturing sectors in good shape," she said.

China's Shanghai Composite Index rose 1.2%, while markets in Japan were closed.

The U.S. dollar started 2018 as it ended last year -- lower. The WSJ Dollar Index, a measure of the U.S. currency against a basket of 16 others, fell 0.3% Tuesday.

Kenan Machado contributed to this article

Write to Christopher Whittall at and Akane Otani at


(END) Dow Jones Newswires

January 02, 2018 13:28 ET (18:28 GMT)

Copyright (c) 2018 Dow Jones & Company, Inc.