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US STOCKS-Tech stocks fuel Wall St rally as factory activity expands

Published 09/02/2020, 02:33 AM
Updated 09/02/2020, 02:40 AM
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(For a live blog on the U.S. stock market, click LIVE/ or
type LIVE/ in a news window)
* Apple rises on reports of orders for 75 mln 5G iPhones
* Zoom surges after raising annual revenue forecast
* Walmart advances after unveiling membership plan details
* Indexes up: Dow 0.39%, S&P 0.45%, Nasdaq 1.16%

(Updates to late afternoon, adds commentary, adds New York
dateline, changes byline)
By Sinéad Carew
NEW YORK, Sept 1 (Reuters) - The S&P 500 and the Nasdaq hit
new highs on Tuesday with technology leading the charge as Apple
and Zoom Video soared and better-than-expected U.S.
manufacturing sector data fueled optimism about the economic
recovery.
In the previous session Wall Street's three main indexes had
recorded their fifth straight monthly gain and their strongest
August advance in more than three decades, which was also partly
thanks to help from technology stocks and central bank support.
On Tuesday heavyweight Apple Inc AAPL.O was up 4%, rising
for the second straight day after its stock split took effect. A
report also said the company had asked suppliers to make at
least 75 million 5G iPhones for later this year. Zoom Video Communications Inc ZM.O surged 39% 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. "There's a bit of support from the economic data as far as
it improves sentiment for the market but I think today investors
are looking at the good earnings we saw coming out of tech,"
said Veronica Willis, investment strategy analyst at Wells Fargo
Investment Institute in St. Louis.
ISM data showed U.S. factory activity expanded for the third
straight month to a reading of 56.0 in August, the highest since
November 2018. 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. At 2:09 p.m. EDT, the Dow Jones Industrial Average .DJI
was up 110.1 points, or 0.39%, at 28,540.15, the S&P 500 .SPX
gained 15.84 points, or 0.45%, to 3,516.15 and the Nasdaq
Composite .IXIC added 136.28 points, or 1.16%, to 11,911.74.

While the Nasdaq and the S&P 500 were scaling all-time
highs, the blue-chip Dow was still about 3.5% below its February
peak.
Technology .SPLRCT , materials .SPLRCM and consumer
discretionary .SPLRCD stocks led gains among the major S&P
sectors.
Hopes that Senate Republicans will unveil a new coronavirus
relief bill next week also helped boost sentiment.
But other strategists expect more market volatility as 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. "There's still a lot of uncertainty mostly around the
pandemic but also some uncertainty around the election. The
closer we get to that election the more volatility we'll see in
the market," said Willis.
Walmart rose 6% after the retailer unveiled the perks of its
new loyalty program, Walmart Plus. Tesla Inc TSLA.O fell 4% 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 declining ones on the NYSE by a
1.36-to-1 ratio; on Nasdaq, a 1.04-to-1 ratio favored decliners.
The S&P 500 posted 33 new 52-week highs and 1 new low; the
Nasdaq Composite recorded 98 new highs and 39 new lows.

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