Advances in Technology Stocks Boost Major U.S. Indexes

The three major U.S. stock indexes rose to record highs on Monday as investors continued to buy in anticipation of a strong earnings season.

The Dow Jones Industrial Average was supported by a strong performance by JPMorgan Chase which rose 2 percent. The S&P 500 Index was led higher by strong advances in telecommunications and financials. Expectations of rising interest rates pressured real estate stocks and uncertainty over U.S. health care reform drove down the health care sector. The NASDAQ Composite was supported by shares of Apple which rose 1.8 percent.

After the close, Netflix reported third-quarter results. Earnings and Revenues beat expectations, driving shares up more than 2 percent during after-hours trading. Netflix also continued to grow, adding 5.3 million net subscribers this past quarter. The company now has about 109.3 million subscribers globally. Netflix said it added 850,000 subscribers in the U.S., ahead of the 810,000 estimate for the quarter.

Netflix stock also hit $200 a share for the first time on Friday.

U.S. Economic Data

On Monday, the Federal Reserve Bank of New York said in a news release that the results of the October Empire State Manufacturing Survey indicates that business activity “grew at a robust pace” for New York manufacturers.

The Empire State Manufacturing Survey general business – conditions index rose six points to 30.2 in October, its highest level since 2014.

The index fell less than a point to 24.4 in September after climbing 15 points to 25.2 in August, which, at the time, was its highest level since September 2014.

The positive reading indicates expansion and usually supports U.S. Treasury yields and the U.S. Dollar.

Gold

Gold prices retreated from a three-week high on Monday, pressured by profit-taking fueled by a firmer U.S. Dollar. However, the selling was limited by speculators defending the psychological $1300.00 level. Ongoing tensions over Iran and North Korea as well as low U.S. inflation have helped support gold throughout the month.

Crude Oil

U.S. West Texas Intermediate and international-benchmark Brent crude oil rose on Monday as investors reacted to a possible hit to output due to an escalating conflict in Iraq. The news helped widen the spread between Brent and WTI crude oil.

The current rally is being fueled by short-covering and speculation in reaction to the news that Iraqi forces on Sunday launched a campaign to retake control of the area surrounding Kirkuk. According to Reuters and Dow Jones, government troops took control of the North Oil Company, a military base and airport.

The crude oil contracts hit their highs for the day after Reuters reported Iraqi Kurdistan temporarily shut down 350,000 barrels a day of production at the Bai Hasan and Avana oil fields due to security concerns.