Dow, S&P 500 hit record highs; dollar loses steam

NEW YORK (Reuters) - Key U.S. equity indexes swept to record intraday highs on Black Friday thanks to gains in consumer staple stocks, while European shares also advanced, and a stabilization in U.S. Treasury yields led investors to sell the dollar.

Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., November 23, 2016. REUTERS/Brendan McDermid

The small cap Russell 2000 also hit a record intraday high on a day when trading volumes are expected to be relatively thin, with the U.S. stock market closing at 1:00 p.m. ET.

The S&P 500 consumer staples index was last up 0.7 percent, while the consumer discretionary sector gained 0.2 percent on Black Friday, which traditionally kicks off the crucial U.S. holiday shopping season.

European shares were headed for a third week of gains, even as commodities stocks fell after a tumble in oil prices. Uncertainty over whether OPEC will agree to cut production at the group’s meeting next week weighed on crude prices.

Over the past few trading sessions, the three main U.S. indexes have hit all-time highs and closed at record levels multiple times.

Those gains came as investors see U.S. President-elect Donald Trump’s promises of tax cuts, higher spending on infrastructure and less regulation as beneficial to certain industries, including banking, industrials and healthcare.

“Trump’s stock market honeymoon continues as the indexes push higher this morning, and the focus now shifts to holiday sales,” said Peter Cardillo, chief market economist at First Standard Financial in New York.

MSCI’s all-country world equity index was last up 1.48 points, or 0.36 percent, at 414.61.

The Dow Jones industrial average gained 51.19 points, or 0.27 percent, to 19,134.37. The S&P 500 was up 5.5 points, or 0.25 percent, at 2,210.22. The Nasdaq Composite was up 9.00 points, or 0.17 percent, at 5,389.68.

Europe’s broad FTSEurofirst 300 index was up 0.24 percent, at 1,350.93.

While positive for stocks, Trump’s surprise victory has sent U.S. Treasury yields higher and prices lower as investors bet his pro-growth and inflationary policies will erode the value of U.S. bonds.

U.S. Treasuries were last steady after two-year yields hit a 6 1/2-year high of 1.1700 percent overnight as investors evaluated how much further the selloff had to run.

“There are a number of people that want to buy in but also don’t want to get whipped by the next 25-to-30 basis point selloff,” said Gennadiy Goldberg, an interest rate strategist at TD Securities in New York.

The dollar index, which measures the greenback against a basket of six major currencies, was last down 0.3 percent at 101.390 as investors took advantage of the pullback in U.S. bond yields to lock in gains that have propelled the currency to a nearly 14-year peak.

Benchmark oil contracts remained on track for a second straight week of gains despite Friday’s losses. Brent crude was last down $1.28, or 2.61 percent, at $47.72 a barrel. U.S. crude was down $1.23, or 2.56 percent, at $46.73 per barrel.

Gold prices tumbled to a 9-1/2 month low of $1,171.2100 an ounce, partly on expectations of a U.S. interest rate rise from the Federal Reserve next month.

Additional reporting by Yashaswini Swamynathan in Bengaluru, Jessica Resnick-Ault in Boston and Karen Brettell and Gertrude Chavez-Dreyfuss in New York; Editing by Bernadette Baum