By Ryan Vlastelica
NEW YORK (Reuters) – The S&P 500 vaulted above 2,000 for the first time on Monday, with financials and biotechnology stocks lifting the benchmark index to a new record as investors bet on equities as a preferred asset over bonds.
The significance of the milestone was more psychological than fundamental, and it represents the cumulation of a six-year rally that has boosted retirement accounts for Americans from Wall Street to Main Street, though the gains have largely benefited wealthier Americans. On a total-return basis the S&P 500 has more than tripled from its 2009 low hit during the financial crisis.
The day’s gains were broad, with all 10 of the S&P 500’s primary sectors advancing. About two-thirds of stocks on both the New York Stock Exchange and the Nasdaq were in positive territory.
“The trend continues to be positive and it’s like fighting a tsunami, it keeps going and going and going and it won’t stop,” said Adam Hewison, president and chief executive at INO.com in Annapolis, Maryland.
The advance comes amid a variety of cautious signals for the economy, including tepid U.S. growth, waning stimulus from the Federal Reserve and a simmering conflict between Ukraine and Russia. In the latest economic data, reads on both the U.S. services sector and the housing market came in below forecasts.
“All the world events are negative; people are just shrugging them off,” said Hewison. “I think we’re going to continue seeing gains.”
Biotech stocks, a primary driver of recent equity gains, continued to outperform on Monday, with the Nasdaq Biotech index <.NBI> up 2.4 percent. Roche Holding AG
InterMune jumped 36 percent to $73.00. Gilead Sciences
The Dow Jones industrial average <.DJI> rose 117.81 points or 0.69 percent, to 17,119.03, the S&P 500 <.SPX> gained 12.94 points or 0.65 percent, to 2,001.34 and the Nasdaq Composite <.IXIC> added 28.52 points or 0.63 percent, to 4,567.07.
Financial shares were among the strongest of the day, rising on expectations that Europe may see more aggressive monetary stimulus. Morgan Stanley
U.S. stocks have been strong of late. Major indexes closed a third week of gains Friday, with the Dow and S&P enjoying their best weeks since April.
(Editing by Bernadette Baum and James Dalgleish)