NEW YORK (BLOOMBERG, REUTERS) - US stocks rose toward all-time highs, with the Dow hitting a record high, as investors remained optimistic on corporate earnings in the second quarter and deals boosted confidence in the global economy.
The US dollar gained, paring its worst monthly decline since January.
The S&P 500 Index pushed toward a record amid Discovery Communications' deal to buy Scripps Networks Interactive. Miners bolstered European shares as copper rose to a two-year high and iron ore surged. HSBC Holdings Plc stoked lenders after reporting earnings that beat estimates. West Texas crude fell back after briefly trading above US$50 (S$67.8) a barrel for the first time since May.
Stocks are rebounding from Friday's selloff as evidence points to resilient global growth, with investors assessing data from the world's top three economies. China's official factory gauge showed continued expansion in June, even as it slipped amid government efforts to curb financial risks. Japan's industrial output expanded in June, while numbers on Friday showed the US economy accelerating in the second quarter.
"Global expansion dynamics are well underway," analysts at Candriam Investors Group wrote in a report. "The European recovery is well on track and is leading to above-trend growth in 2017-18. This has led us to increase our profit earnings expectations for euro-zone equities. The economic news flow is starting to become more supportive in the US, while emerging markets are benefiting from a good economic momentum."
Meanwhile, the slew of corporate earnings continues. Apple, Tesla, Berkshire Hathaway and Toyota Motor are all set to unveil results this week. HSBC's second-quarter profit beat analysts' estimates as outgoing chief executive officer Stuart Gulliver boosted revenue while also trimming costs, and the lender said it will spend up to $2 billion buying back stock.
Investors have been counting on earnings to support the relatively high valuations for equities, with the S&P 500 trading at about 18 times earnings estimates for the next 12 months, above its long-term average of 15 times.
At 9:37 a.m. ET (9:37 p.m. Singapore time), the Dow Jones Industrial Average was up 61.07 points, or 0.28 per cent, at 21,891.38, the S&P 500 was up 4.68 points, or 0.19 per cent, at 2,476.78 and the Nasdaq Composite was up 18.28 points, or 0.29 per cent, at 6,392.96.
Seven of the 11 major S&P sectors were higher, with the financial index's 0.38 percent rise leading the gainers. On data front, contracts to buy previously owned homes rebounded in June after three straight monthly declines.
Advancing issues outnumbered decliners on the New York Stock Exchange by 1,495 to 1,017. On the Nasdaq, 1,278 issues rose and 971 fell.