U.S. Stocks Climb With Small Caps After Europe Shares End Flat

U.S. stocks inched higher as investors assessed a rally that has lifted equities to record levels in the past month.

The S&P 500 Index added 0.2 percent to 2,262.53 at 4 p.m. in New York. The benchmark gauge fell 0.2 percent Friday after a report that China seized a U.S. drone in international waters in the South China Sea sparked geopolitical concerns. The Dow Industrials added 0.2 percent Monday as small-cap shares jumped 0.6 percent.

European stocks closed little changed, after two straight weeks of gains, as investors kicked off the last full week of trading of the year. The Stoxx Europe 600 Index fell 0.1 percent at the close. In a reversal of the recent rotation into cyclical shares, banks and miners declined as defensive stocks including utilities, real estate and technology advanced.

U.S. Stock Market 

  • Phone and real estate shares gained as energy and health-care stocks fell
  • Strategists on average expect the S&P 500 to end 2017 at 2356, according to the mean of 15 estimates compiled by Bloomberg; that’s 4.3% higher than the Friday close
  • The benchmark gauge is poised for its fifth straight quarterly advance and is up more than 10% for the year
  • All four major benchmarks reached all-time highs after the election; financials have led gains on bets higher borrowing costs will boost profitability
    • S&P 500 Banks Index up 30% in the final quarter of 2016, the biggest advance among 24 industry groups
  • After Federal Reserve officials said they expect three quarter-point rate increases next year, up from two seen in September, traders are pricing in a 73% chance of an increase in June 2017 -- the first month with at least even odds for an increase
  • EARNINGS
    • After market Monday: Worthington Industries Inc. (WOR)
    • Before market Tuesday: Patheon NV (PTHN), BlackBerry Ltd (BB CN), CarMax Inc (KMX), Darden Restaurants Inc (DRI), FactSet Research Systems Inc (FDS), General Mills Inc (GIS), Navistar International Corp (NAV), The Valspar Corp (VAL), Carnival Corp (CCL)

Europe Market

  • The VStoxx Index of euro-area stock volatility was little changed near its lowest in more than two years, down 39% since the U.S. election, as speculation of stronger economic growth boosted equities
  • The volume of Stoxx 600 shares traded on Monday was about a third lower than the 30-day average, data compiled by Bloomberg show
  • Financials fell for a second day. Banca Monte dei Paschi di Siena SpA slid 11% after saying it will sell shares to institutional investors through Thursday, as it aims to complete raising funds by year-end to avoid a rescue by the Italian government
  • Deutsche Bank AG slid 4.5% amid reports its settlement with the U.S. Department of Justice could come this week
  • Barclays Plc declined 2.7% as the lender prepares to tell 7,000 clients to do more trading with the firm or find another bank, in a bid to boost returns
  • The Stoxx 600 is on course for its first annual decline since the peak of the sovereign-debt crisis in 2011, while the FTSE 100 is poised for its best rally in three years as a post-Brexit slump in the pound boosted U.K. exporters

For related equity market news:

Before it's here, it's on the Bloomberg Terminal.
LEARN MORE