US Stocks end at record highs

The US stock market finished session near or above prior all-time records on Tuesday, 01 September 2020, as upbeat economic reports and dovish tones from the Fed helped feed the buying momentum. At closing bell, the Dow Jones Industrial Average index advanced 215.61 points, or 0.76%, to 28,645.66. The S&P 500 index added 26.34 points, or 0.75%, to 3,526.65. The tech-heavy Nasdaq Composite Index grew 164.21 points, or 1.39%, to 11,939.67.

The Wall Street gained strength after Federal Reserve Governor Lael Brainard said the central bank should pivot to provide more support for U.S. economic growth, presumably meaning the Fed could purchase more assets, such as U.S. Treasurys or privately issued debt.

 

Adding to the positive sentiment, the Institute for Supply Management released a report showing manufacturing activity in the U.S. expanded at a faster rate in the month of August. The ISM said its purchasing managers index rose to 56.0 in August from 54.2 in July, with a reading above 50 indicating growth in manufacturing activity.

Technology stocks saw continued strength on the day, with Apple (AAPL) helping to lead the sector higher after yesterday's stock split.

Shares of Zoom Video (ZM) also spiked after the video conferencing company reported better than expected second quarter results and raised its full-year guidance.

ECONOMIC NEWS: US Construction Spending Edges Higher In July-- US construction spending inched up by 0.1% to an annual rate of $1.365 trillion in July after falling by 0.5% to a revised rate of $1.363 trillion in June, according to a report released by the Commerce Department on Tuesday. The uptick in construction spending came as spending on private construction climbed 0.6% to an annual rate of $1.014 trillion. Spending on residential construction spiked 2.1% to a rate of $546.6 billion, while spending on non-residential construction slumped by 1.0% to a rate of $466.9 billion. Meanwhile, the report said spending on public construction tumbled by 1.3% to an annual rate of $351.1 billion.

US Manufacturing Activity Expands In August- US manufacturing purchasing managers index rose to 56.0 in August from 54.2 in July, with a reading above 50 indicating growth in manufacturing activity, the Institute for Supply Management revealed in a report on Tuesday. The bigger than expected increase by the headline index came as the new orders index jumped to 67.6 in August from 61.5 in July. The production index also increased to 63.3 in August from 62.1 in July, while the employment index climbed to 46.4 from 44.3 but still indicates a contraction. On the inflation front, the prices index surged up to 59.5 in August from 53.2 in July, indicating an acceleration in the pace of price growth.

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