All three U.S. stock benchmarks rose together to record highs for the first time in 16 years on Thursday amid surprising earnings.
The S&P 500 index, Dow Jones industrial average and Nasdaq composite index advanced amid better-than-forecast profits at retailers Macy’s Inc. and Kohl’s Corp.
Meanwhile, European shares erased the slump that followed Britain’s secession vote. Oil climbed, while Treasuries slumped.
Europe’s stocks closed at the highest mark since May. Oil climbed on speculation producers could agree on moves to support prices during talks in September. Treasuries fell as an auction of 30-year bonds saw a retreat from the level of investor interest at previous sales this week.
Investors have piled into global equities amid better-than-estimated corporate earnings, improving economic data and optimism central banks will stay supportive of growth. The number of Americans filing applications for unemployment benefits was little changed last week, holding near four-decade lows that highlight a more robust labor market. Still, that stronger jobs picture has yet to convince traders that the world’s largest economy is solid enough for the Federal Reserve to raise interest rates this year.
“We’re continuing to grind higher,” said Stephen Carl, principal and head equity trader at Williams Capital Group LP in New York. “You had some retail earnings that came in better than expected. Economic numbers such as jobless claims didn’t do anything to challenge the strength.”
The S&P 500 gained 0.5 percent, to 2,185.79, extending this year’s advance to 6.9 percent. The Dow and Nasdaq added more than 0.4 percent. The three indexes rose simultaneously to records for the first time since Dec. 31, 1999.
Fresh records in U.S. stocks are getting harder for strategists to ignore. Wells Fargo & Co. became just the second of 21 firms tracked by Bloomberg to raise its target for the S&P 500 since the measure surged past the group’s average year-end prediction a month ago. Gina Martin-Adams, the bank’s chief U.S. equity strategist, now expects the benchmark for American equities to climb to 2,200 in 12 months.
Macy’s jumped 17 percent after also saying it plans to close about 14 percent of its stores in a bid to maintain profitability. Kohl’s rallied the most ever, while peers J.C. Penney Co. and Nordstrom climbed at least 7.5 percent. More than four-fifths of the S&P 500’s companies have posted results so far, of which 78 percent beat profit projections and 56 percent exceeded sales expectations.
The Stoxx Europe 600 Index rose 0.8 percent, reversing an earlier drop to rise for the sixth time in seven days. Zurich Insurance added 4.5 percent after saying profit fell less than projected. Belgian lender KBC Group NV advanced 5.2 percent after also cutting its forecast for 2016 loan-loss provisions in Ireland.