The US markets closed higher on Monday, with the Dow leading the gains as investors continued to focus on corporate earnings and prospects for tax cuts. Market sentiment has grown less positive in recent weeks, with investors more concerned about tax policy, fuller valuations and a sense of complacency. From a fundamental perspective, investors are also becoming worried about the flattening yield curve and high yield market weakness, which tend to be bearish signals for equities.
On the economy front, the leading economic index surged 1.2% in October and suggested no letup in a steadily growing US economy with the end of the year fast approaching. The increase blew past a meager 0.1% gain in September, when a spate of hurricanes battered Texas and Florida. The LEI is a weighted gauge of 10 indicators designed to signal business-cycle peaks and valleys. A measure of current economic conditions rose 0.3%, according to a survey produced by the privately run Conference Board. A lagging index that looks back at the recent past moved up 0.2%.
The Dow Jones Industrial Average gained 72.09 points or 0.31 percent to 23,430.33, the Nasdaq added 7.923 points or 0.12 percent to 6,790.71, and the S&P 500 edged higher by 3.29 points or 0.13 percent to 2,582.14.