By Anora Mahmudova and Carla Mozee, MarketWatch
NEW YORK (MarketWatch) -- U.S. stocks advanced, pushing the Dow
Jones Industrial Average above 17,000 and its previous closing
record on Monday as investors welcomed better-than-expected
earnings from Citigroup Inc. and a flurry of mergers and
acquisitions.
The banking heavyweight's profit topped estimates, even as it
reached a $7 billion settlement with the U.S. Justice Department
over shoddy mortgage-backed securities. Shares jumped 4%.
The S&P 500 (SPX) rose 10 points, or 0.5%, higher at
1,977.50, with financial stocks leading the gains. The Dow Jones
Industrial Average (DJI) added 123 points, or 0.7%, to 17,066.91,
topping its previous record close level.
The Nasdaq Composite (RIXF) gained 24 points, or 0.5%, to
4,438.91.
Follow MarketWatch's live blog of today's stock-market
action.
"This market has defied all odds and we are seeing a classic
18-month-long climb up the wall of worry, said Vince Lowry, CEO of
RevenueShares.
"We expect the second half to be choppy and a 5-10% pullback
would be healthy. However, the issue right now is that there are no
sellers, as people do not want to miss out on the rally," Lowry
added.
The pace of the second-quarter earnings season will move into
high gear this week with results due from large companies in the
financial and technology sectors, the two largest sectors in the
S&P 500 index.
Citigroup Inc. (C): The bank said it would pay $7 billion to
settle claims regarding sales of mortgages before the financial
crisis. The company also beat consensus forecasts for
second-quarter earnings and revenues. Shares rose 3.2%.
The banking sector and "valuations are going to remain the main
focus for this week, as we will get the earnings from some of the
biggest tycoons of Wall Street," said Naeem Aslam, chief market
analyst at AvaTrade, in a note. "The expectations are high, and
investors are hoping that these earnings will cement the optimism
that growth is on track in the U.S. and that revenues are
healthy."
There are no Federal Reserve speakers or data reports on the
calendar Monday, though Fed Chairwoman Janet Yellen will field
questions from Congress on Tuesday and Wednesday. This week will
see the retail sales report for June on Tuesday, which could offer
clues about whether consumers are starting to feel more optimistic.
Also on the docket this week are reports on new home construction,
manufacturing and consumer sentiment.
Monday lived up to its merger day status, with a flurry of
companies announcing deals. Shares of drug maker AbbVie Inc.(ABBV)
fell 0.7% after Shire PLC (SHPGY) said Monday it has received a new
takeover offer from AbbVie, and that it's willing to recommend the
deal, now valued at more than $53 billion, to its shareholders.
Mylan Inc. shares (MYL) tacked on 2.7% following news of the
drug company's plan to buy a portion of Abbott Laboratories' (ABT)
generics business in a deal valued at $5.3 billion.
Apple Inc. (AAPL): shares rallied 1.7% after analysts Barclays
and Morgan Stanley lifted their target price on the stock to
$110.
In the commodities market, crude oil futures(CLQ4) swung between
small gains and losses after logging a third consecutive weekly
decline. Gold futures(GCQ4) tumbled Monday as solid gains for
stocks and lackluster physical demand prompted investors to book
profits on recent gains.
Asian stocks overnight finished broadly higher, with Tokyo's
Nikkei Average ending up by 0.9%. European stocks rose as fears
about the soundness of Portuguese banks receded.
More news from MarketWatch:
Avoid a U.S. stock market meltdown and go global
Apple denies it's a threat to China's security
Chinese man builds his own Tesla-charging network
Subscribe to WSJ: http://online.wsj.com?mod=djnwires