Wall Street gains, helped by oil, economic data

By Lewis Krauskopf

(Reuters) - Wall Street rose on Monday, with the Dow Jones industrials setting a fresh intraday record high, as further gains in oil prices fuelled the energy sector and data showed strength in the domestic economy.

U.S. services sector activity hit a one-year high in November, with a surge in production boosting hiring, following on the heels of Friday's employment report that showed strong job gains last month.

U.S. stocks have climbed since the Nov. 8 election, fuelled by expectations of significant economic stimulus and cuts in corporate taxes and regulations under President-elect Donald Trump.

"A lot of people were negative going into the election, or cautious, so now they're scrambling year-end to own stocks," said Alan Lancz, president of investment advisory firm Alan B. Lancz & Associates Inc in Toledo, Ohio.

 

Lancz said U.S. investors on Monday also were encouraged by strength in European equities following Italy's political referendum. Prime Minister Matteo Renzi was set to resign after suffering a resounding defeat over constitutional reform.

The energy sector <.SPNY> gained 1 percent as crude rose above $55 a barrel to hit a 16-month high in the wake of last week's OPEC landmark deal to cut production.

"We have oil prices moving up and we've had good economic numbers today. That's why the market is handling itself as well as it is," said Peter Cardillo, chief market economist at First Standard Financial in New York.

The Dow Jones industrial average <.DJI> rose 30.85 points, or 0.16 percent, to 19,201.27, the S&P 500 <.SPX> gained 10.55 points, or 0.48 percent, to 2,202.5 and the Nasdaq Composite <.IXIC> added 45.70 points, or 0.87 percent, to 5,301.35.

The Dow has topped the other major indexes since the election, as investors have rotated into the financial and industrial sectors.

Goldman Sachs shares rose 2 percent to $227.73 and touched their highest in nine years after HSBC initiated coverage with a "buy" rating and a $250 price target.

Big tech names also lifted the S&P 500 and helped the Nasdaq outperform on Monday. Amazon.com rose 2.5 percent as it said it opened a brick-and-mortar grocery store in Seattle without lines or checkout counters.

FairPoint shares jumped 12.4 percent after Consolidated Communications said it would buy the broadband service provider for $1.5 billion, including debt. Shares of Consolidated were off 3.8 percent.

Health insurers Aetna and Humana were down more than 3 percent as a trial over their proposed merger kicked off. The health sector <.SPXHC> fell 0.4 percent and was the worst-performing group.

Advancing issues outnumbered declining ones on the NYSE by a 2.56-to-1 ratio; on Nasdaq, a 2.87-to-1 ratio favoured advancers.

The S&P 500 posted 50 new 52-week highs and 2 new lows; the Nasdaq Composite recorded 197 new highs and 23 new lows.

(Additional reporting by Sinead Carew in New York and Yashaswini Swamynathan in Bengaluru; Editing by Sriraj Kalluvila and Nick Zieminski)