NEW YORK (REUTERS) - Industrials led the Dow to a new closing high on Friday (Sept 21) ahead of Monday's major sector reshuffle, capping a week that largely shrugged off trade worries.
Trading volume spiked to the highest level since Feb 9 in anticipation of the S&P 500 sector change, when telecoms will be folded into a new sector called communications services, along with heavy-hitting stocks such as Facebook Inc and Walt Disney.
While the Dow closed higher, the S&P 500 and the Nasdaq ended the session in negative territory. The S&P and the Dow posted weekly gains, with the Dow showing its biggest weekly percentage advance in over two months. The Nasdaq lost ground on the week.
"Quadruple witching," when stock options and futures expire, and the rebalancing of the S&P 500 and the Russell 2000 indexes also contributed to heavier traffic.
"A lot of those changes have been anticipated by the index funds, and they've prepared for it," said Tim Ghriskey, chief investment strategist at Inverness Counsel in New York.
"But there's a lot going on."
Boeing, the United States' biggest exporter to China, boosted trade-sensitive industrials higher. The sector led the Dow's advance.
Yields on long-dated US Treasuries edged down on Brexit anxieties even with Federal Reserve expected to hike key interest rates next week. Financial stocks headed lower, ending their recent rally.
"Any time there is a rate hike you potentially see a flattening of the yield curve, which is not good for financials," said Ghriskey.
The Dow Jones Industrial Average rose 86.52 points, or 0.32 per cent, to 26,743.5, the S&P 500 lost 1.08 points, or 0.04 per cent, to 2,929.67 and the Nasdaq Composite dropped 41.28 points, or 0.51 per cent, to 7,986.96.
Telecoms rose 1 per cent on its last trading day as a discrete major S&P sector, and was the index's biggest percentage gainer.
All of the FAANG momentum stocks ended the session lower, with Facebook, Apple, Amazon.com, Netflix and Google parent Alphabet down between 1.1 per cent and 1.9 per cent.
Shares of security and alarm company ADT jumped for a second day in a row, closing up 5 per cent as Amazon introduced its new Alexa Guard service which could notify ADT of disturbances in the home.
McDonald's Corp rose 2.8 per cent after announcing it would hike its quarterly dividend by 15 percent.
Under Armour Inc gained 2.9 per cent following an upgrade by JPMorgan Chase.
A 2.9 per cent drop in shares of Micron helped pull chipmakers lower after the company said US tariffs on Chinese goods would weigh on its financial results for as much as a year.
Shares of Pier 1 Imports plunged 19.9 per cent after the home furnishings retailer cut its second-quarter forecasts.
Advancing issues outnumbered declining ones on the NYSE by a 1.04-to-1 ratio; on Nasdaq, a 1.21-to-1 ratio favoured decliners.
The S&P 500 posted 56 new 52-week highs and 1 new lows; the Nasdaq Composite recorded 64 new highs and 46 new lows.
Volume on US exchanges was 10.77 billion shares, nearly 64 per cent higher than the 6.57 billion average over the last 20 trading days.