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US STOCKS-Dow eyes record highs in thin holiday trade; retailers jump

US STOCKS-Dow eyes record highs in thin holiday trade; retailers jump

reuters.com · 12/29/2021 10:26
US STOCKS-Dow eyes record highs in thin holiday trade; retailers jump

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Dow nears an all-time high

Tesla CEO Musk nears 10% stake sale pledge

Rivian slips on delaying deliveries for EV truck and SUVs

Indexes: Dow rises 0.26%, S&P up 0.12%, Nasdaq dips 0.17%

Updates to open

By Medha Singh and Anisha Sircar

- The Dow inched towards an all-time high on Wednesday, on a boost from retailers Home Depot and Nike, while record daily U.S. COVID-19 infections kept gains in check amid low liquidity in the final week of the year.

Home Depot HD.N and Nike Inc NKE.N advanced 1% and 2%, respectively, against the backdrop of recent reports suggesting holiday sales were strong for U.S. retailers. nL1N2TB07T

Some early studies pointing to a reduced risk of hospitalization in Omicron cases have helped investors look past the travel disruptions and powered the S&P 500 to record highs this week.

"The market thinks that Omicron is going to hit just a few sectors of the whole economy, and most stocks will be good for that," said Luiz Pacheco, wealth advisor at Brainvest Wealth Management based in Miami.

Meanwhile, the S&P 1500 airlines index .SPXCOMAIR shed 1.3%. Delta Air Lines DAL.N and Alaska Air Group ALK.N canceled hundreds of flights again on Tuesday as daily tally of infections in the United States surged. nL4N2TD1UMnL8N2TE11Q

Six of the 11 major S&P sector indexes advanced. The energy index .SPNY, though, slipped 0.6% as oil prices slipped on demand concerns.

Typically, the final five trading days of the year and the first two of the subsequent year are seasonally strong for U.S. stocks. However, market participants warned against reading too much into daily moves as the holiday season tends to record some of the lowest volume turnovers that cause exaggerated price action.

At 10:05 a.m. ET, the Dow Jones Industrial Average .DJI was up 93.90 points, or 0.26%, at 36,492.11, the S&P 500 .SPX was up 5.79 points, or 0.12%, at 4,792.14, and the Nasdaq Composite .IXIC was down 27.45 points, or 0.17%, at 15,754.27.

The S&P 500 dipped on Tuesday in the lowest trading volume session of 2021, snapping a four-day winning streak. nL8N2TE11Q

As 2021 draws to a close, the main U.S. stock indexes are on pace for their third straight year of stunning annual returns, boosted by historic fiscal and monetary stimulus. The S&P 500 is looking at its strongest three-year performance since 1999.

The focus next year will shift to the U.S. Federal Reserve's path of interest rate hikes amid a surge in prices caused by supply chain bottlenecks and a strong economic rebound.

Among other stocks, Rivian Automotive RIVN.O dropped 3.6% after company announced it would delay deliveries of its electric pickup truck and sports utility vehicle with big battery packs to 2023. nL4N2TD1UV

Electric-car maker Tesla's TSLA.O CEO Elon Musk exercised all of his options expiring next year, signaling an end to his stock sales. Its shares dropped 1.3% but were still on course to end about 54% for the year. nL1N2TE04B

Declining issues outnumbered advancers for a 1.16-to-1 ratio on the NYSE and for a 1.97-to-1 ratio on the Nasdaq.

The S&P index recorded 53 new 52-week highs and no new low, while the Nasdaq recorded 38 new highs and 240 new lows.

(Reporting by Medha Singh and Anisha Sircar in Bengaluru; editing by Uttaresh.V)

((Medha.Singh@thomsonreuters.com; within U.S. +1646 223 8780, outside U.S. +91 80 6182 2802; Twitter: https://twitter.com/medhasinghs;))