NEW YORK: US stocks jumped to fresh records Monday behind stronger oil prices, while European markets were little changed.
All three major US indices pushed to fresh records for the second time in three sessions. Prior to last Thursday, that feat had not been accomplished in more than 16 years.
Wall Street stocks have been propelled to fresh records by the comparative strength of the US economy, coupled with expectations of accommodative monetary policy, including very-low interest rates set by the Federal Reserve.
Analysts said Monday’s records were largely due to positive momentum, on a light day as far as major economic reports and earnings.
Besides energy equities, which were boosted by higher oil prices, sectors with outsized gains included industrials, financials and materials.
“It’s a very low-volume month with not a lot of data out there, and so it’s sort like a self-fulfilling momentum,” said Sam Stovall of S&P Global Intelligence.
London and Frankfurt saw small gains while Paris was nearly flat in the absence of major European data and with trading subdued on an official holiday in France and parts of Germany.
In Asia most markets advanced on Monday but Tokyo lost 0.3 percent as official figures showed Japan’s economy stalled in the second quarter.
Growth in the world’s third largest economy came in at zero percent quarter-on-quarter, missing predictions for a 0.2 percent expansion in the April-June period, on weak exports and lower business spending.
Chinese stocks rise
Chinese shares rallied on news the government could soon link trading on the Shenzhen exchange with the Hong Kong bourse.
Hong Kong rose 0.7 percent, while Shanghai finished the day up 2.4 percent after the China Securities Regulatory Commission said on Friday that the Shenzhen-Hong Kong Stock Connect scheme would be launched this year.
China launched a landmark “stock connect” between the Shanghai and Hong Kong exchanges in late 2014, which allowed foreign investors to trade selected stocks on Shanghai’s tightly restricted exchange and let mainland investors buy shares in Hong Kong.
Oil prices rose for the third straight day, lifted by remarks from a Russian official who hinted at a possible production freeze in cooperation with OPEC.
The comments followed statements last week from Saudi Arabia’s oil minister, who said a meeting of oil producers next month could yield an agreement on stabilizing prices.
The British pound slumped to a fresh three-year low against the euro Monday and edged lower on the dollar, as signs of weakness mounted in the British economy.
The currency’s fall came as data from Britain showed London residential rents fell for the first time in six years in July, amid worries the June 23 vote to exit the European Union was already having an impact on the economy.