A Trifecta of Records. All three main U.S. stock indexes closed at record highs on Thursday amid light postholiday trading. The Nasdaq Composite rose above 9000 for the first time, fueled in part by Amazon.com’s gains after the e-commerce giant reported a record-breaking 2019 holiday season. U.S. jobless claims fell slightly less than economists had predicted, while the U.S. and China are getting one step closer to signing the initial trade deal. In today’s After the Bell, we...
- watch the Nasdaq shooting over 9000 for the first time;
- wonder why it took the market so long to notch that triumph;
- and continue to wait for the signing of the U.S.-China trade deal and its detailed content.
The 9000 Benchmark
Stocks kept rising on Thursday after the market returned to normal business following the holiday break. The Dow Jones Industrial Average gained 105.94 points, or 0.37%, to 28,621.39, while the S&P 500 added 16.53 points, or 0.51%, to 3239.91, and the Nasdaq rose by 69.51 points, or 0.78%, to 9022.39.
The Nasdaq crossed the 9000 threshold for the first time, fueled particularly by Amazon.com’s (ticker: AMZN) 4.5% rise. It’s taken the index 335 days to make it from 8000 to 9000—a fairly long time compared with recent history.
It’s worth noting that as the numbers get bigger, a 1,000-point move should become easier to achieve due to the smaller percentage change needed. Still, it took Nasdaq only 174 days to get from 6000 to 7000, and 164 days to get from 7000 to 8000—both times much faster than 335 days.
Before that, however, the Nasdaq took more than 4300 days—or more than 17 years, from March 2000 to April 2017—to get from 5000 to 6000, after the tech bubble burst in the early 2000s and the financial crisis hit in 2009.
Year to date, the tech-heavy Nasdaq Composite is up 36%, outpacing the S&P 500’s 29% gain by large margins. Investors still loved big tech stocks in 2019.
The Nasdaq’s two biggest components are Apple (AAPL) and Microsoft (MSFT), which have gained 83% and 56% this year, respectively. Still, there are a handful of stocks in the S&P 500’s Information Technology sector that are on track to finish 2019 in the red.
More positive headlines regarding the U.S.-China trade deal also drove markets higher today. President Donald Trump said the phase-one trade deal is now completed and being translated, and he and Chinese President Xi Jinping will hold a signing ceremony soon.
China’s Foreign Ministry spokesman Geng Shuang also said that both countries have kept in close contact about detailed arrangements for the deal’s signing, while Chinese Commerce Ministry said that details about the deal’s content would be made public following the official signing.
China has already announced tariff cuts in 2020 and ramped up soybean imports from the U.S. in December. China’s General Administration of Customs also signaled that it may soon exempt a new batch of U.S. products from the previously imposed tariffs on $60 billion U.S. goods.
Write to Evie Liu at evie.liu@barrons.com
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