By Medha Singh and Devik Jain
(Reuters) – Wall Street climbed on Tuesday as gains in Apple and Zoom Video shares propelled the tech-heavy Nasdaq to record highs, while better-than-expected U.S. manufacturing sector data fueled optimism around a post-pandemic economic recovery.
Apple Inc (NASDAQ:) gained 2.2%, rising for the second straight day after its stock split took effect, as a report said the iPhone maker had asked suppliers to make at least 75 million 5G iPhones for later this year.
Among top boosts to the Nasdaq was Zoom Video Communications (NASDAQ:) Inc, which surged 36.6% after the video-conferencing platform raised its annual revenue forecast by more than 30% as it converted more of its huge free user base to paid subscriptions.
ISM data showed U.S. factory activity expanded for the third straight month to a reading of 56.0 in August, the highest since January 2019. The figures follow encouraging manufacturing surveys from China and Europe earlier in the day.
However, employment continued to lag, according to ISM data, supporting views that the labor market recovery was losing momentum. Investors will keep a close eye on the monthly U.S. jobs report due on Friday.
Wall Street’s main indexes recorded their fifth straight monthly gain on Monday, riding massive central bank support, U.S. government aid and demand for tech-focused stocks.
While the Nasdaq and S&P 500 have scaled all-time highs recently, the blue-chip Dow is still about 4% below its February peak.
“There are limited options where you can buy growth, because the country is slowly reopening and tech does the best in the slow growth economy,” said Thomas Hayes, managing member at Great Hill Capital LLC in New York.
Technology, materials and consumer discretionary stocks were leading gains among the major S&P sectors.
Treasury Secretary Steven Mnuchin’s comment that a new coronavirus relief bill will “hopefully” be unveiled next week also boosted sentiment.
U.S. politics will take center stage in the coming weeks. Republican president Donald Trump, who is running for re-election against Democratic presidential nominee Joe Biden, has seen his polling gap with the former vice president narrow recently.
At 11:00 a.m. ET, the was up 44.44 points, or 0.16%, at 28,474.49, the S&P 500 was up 9.78 points, or 0.28%, at 3,510.09. The was up 106.53 points, or 0.90%, at 11,881.99.
Walmart (NYSE:) Inc rose 4.4% after the retail giant unveiled the perks of its new loyalty program, Walmart Plus, which will grant subscribers unlimited free delivery, fuel discounts and no checkout lines.
Tesla (NASDAQ:) Inc fell 1.1% after the electric-car maker announced plans to raise up to $5 billion through a share sale program a day after its 5-for-1 stock split.
Advancing issues outnumbered decliners for a 1.42-to-1 ratio on the NYSE. Declining issues outnumbered advancers for a 1.02-to-1 ratio on the Nasdaq.
The S&P index recorded 26 new 52-week highs and no new low, while the Nasdaq recorded 72 new highs and 28 new lows.