U.S. Stocks at Records Amid Earnings, Metals Rally: Markets Wrap

(Bloomberg) -- U.S. stocks rose the most in three weeks, sending the S&P 500 Index to an all-time high, while Treasuries tumbled as investors resumed bets that growth in the world’s largest economy is set to accelerate. Commodities rallied.

The Nasdaq Composite Index also climbed to a record, with materials producers leading gains as copper and aluminum advanced. Housing stocks surged after the largest U.S. builder delivered earnings, while engineering firms gained as President Donald Trump took steps to advance construction of oil pipelines. Banks jumped as the yield on the 10-year Treasury note climbed back above 2.45 percent. Crude topped $53 a barrel.

While politics continued to sway financial markets as a U.K. court ruled parliament must vote on any Brexit plan. Donald Trump sought to cajole U.S. automakers to build plants in America and vowed to renegotiate the Keystone XL and Dakota Access pipelines. Investors also turned to a slate of corporate earnings that began to show signs that the economy was on firm footing at the end of 2016. D.R. Horton Inc.’s results come amid data showing rising home construction and a pickup in demand as mortgage rates start to climb. The first reading on last quarter’s U.S. economic output is due Friday.

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Here are the main moves in markets:

Stocks

• The S&P 500 Index rose 0.7 percent to 2,280.04 at 4 p.m. in New York, topping its Jan. 6 high. The measure rose the most since Jan. 3, snapping a streak of 13 sessions without a move greater than 0.35 percent.
• Materials producers in the index surged 2.5 percent, the most since March. DuPont Co. rose 4.5 percent after its results topped estimates and the company said it would delay its expected closing of a merger with Dow Chemical Co.
• D.R. Horton and Lennar Corp. jumped at least 6 percent to lead homebuilders higher.
• Johnson & Johnson and Verizon Communications Inc. slumped more than 1.8 percent to lead losses in the Dow Jones Industrial Average, which topped 19,900 for the first time since Jan. 12.
• The small-cap Russell 2000 Index had its best day in three weeks with a 1.6 percent advance. It’s still 1.4 percent below a record set Dec. 9.

Bonds

• The yield on the 10-year Treasury rose six basis points to 2.46 percent, reversing a seven basis-point drop on Monday.
• Tuesday’s $26 billion two-year U.S. note sale drew a yield of 1.21 percent, above the level indicated before the auction.

Currencies

• The Bloomberg Dollar Spot Index rose 0.1 percent. The greenback has fallen for four straight weeks, the longest retreat since February.
• The British pound slipped 0.2 percent to $1.2505 as investors bet a Supreme Court loss for U.K. Prime Minister Theresa May won’t derail the start of a process to exit the European Union.

Commodities

• The Bloomberg Commodity Index climbed for a third day as aluminum rose to a 20-month high after China was said to be drawing up plans that would halt capacity.
• Gold futures fell 0.4 percent to settle at $1,210.80 after closing Monday at a two-month high.
• Oil rose 0.8 percent to settle at $53.18 a barrel in New York, the highest close since Jan. 6. Iraq said it’s close to implementing its share of pledged output curbs as part of OPEC’s effort to trim bloated global inventories.

--With assistance from Eddie van der Walt Todd White Natasha Doff and Cecile Gutscher To contact the reporter on this story: Jeremy Herron in New York at jherron8@bloomberg.net. To contact the editors responsible for this story: Jeremy Herron at jherron8@bloomberg.net, Cecile Gutscher