US stocks have kicked off the new year higher. Gains in technology and retail are driving the growth. The retail and tech companies were also the biggest gainers in 2017 and it seems that this trend will continue this year. Bond yields are also rising. Gas prices too are up as cold weather in the US and Canada continues. Asian stocks have also not been left behind. Stocks in the regions climbed after China released a robust economic outlook for 2018.
The Standard & Poor’s 500 Index rose 14 points to close at 2,687 as investors returned to trading after the New Year’s break. The S&P has been on a roll in the recent months growing 19% in 2017. Early indicators show that 2018 could also be a great year. The Dow Jones industrial average recorded gains too climbing 0.5% to hit 24,829. Growth was also reported on the NASDAQ composite with a 1% jump as the Russell 2000 Index for smaller company stocks gained 0.8% to reach 1,544.
Technology companies have been central to the growth seen so far in the stock market. Although investors are hoping that the momentum will be maintained in 2018, the big question now is if tech stocks can do really do it again. Early indications show that they could.
Facebook, for instance, started the year with a 2.4% jump to hit $178.50 per share. Chipmaker Nvidia was up 1.3%. These were two of the biggest gainers in the first day of trading in the NYSE, but on average, technology stocks were doing relatively better compared to other industries. The tech index for the S&P 500 grew almost 37% in 2017 too. Big tech players such as Facebook, Microsoft, and Apple also reached all-time highs last year.
Retailers are also on the rise. Amazon, for example, led the way with a $9.22 gain. The e-commerce giant is one of the few companies trading at above $1,000 per share and at the time of writing this article shares were already at $1,178.70. Kohl’s was also another retailer on the rise with a 2.9% growth.
We are also seeing an increase in bond yields. The 10-year Treasury note was up by 2.45% as the 2-year yield recorded a 1.92% jump. This, however, had a ripple negative effect on high dividend stocks including utilities, real estate, and household goods. Performance of the US Dollar against other major currencies is also commendable with crude oil prices dipping slightly at the start of the year.
In other countries overseas, there were mixed outcomes but nonetheless, the outlook is also positive. The DAX fell 0.8% with the CAC 40 shedding 0.6% at the start of trading. Strong economic data from China also boosted stock markets in Asia. Manufacturing data for December was strong in both China and India, two of the biggest growth drivers in the region. The Hang Seng in Hong Kong was up 2% with Korea’s Kospi gaining 0.5%.