Stocks rise as banks raise dividends, confidence grows
Stocks were moderately higher Tuesday as major banks announced plans to return billions more to their shareholders in the form of dividends and stock buybacks
BEIJING — Stocks were moderately higher Tuesday as banks announced plans to return billions more to shareholders and consumer confidence grows.
The S&P 500 rose 0.1% as of 11:36 a.m. Eastern. The Dow Jones Industrial Average was up 99 points, or 0.3%, to 34,382 and the Nasdaq composite was mostly unchanged.
With two trading days left in June, the market is getting ready to close out a strong first half of the year as the economy emerges from its pandemic-induced recession. The S&P 500 is on track for a gain of more than 14% for the first half of 2021.
Technology and bank stocks were among the biggest gainers. Morgan Stanley rose 3.8% after the bank announced it would double its quarterly dividend and buy back $12 billion of its own stock over the next year.
Morgan Stanley was one of several banks to announce dividend increases and stock buybacks after passing the Federal Reserve’s most recent “stress tests.” As part of passing the tests, the Fed freed the banks from the coronavirus pandemic restrictions that had been placed upon them last year.
Other bank stocks that were higher included JPMorgan Chase, which was up 0.8%, and Goldman Sachs, which was up 2%.
Boeing rose 0.4% after United Airlines announced it would buy 200 of the company’s 737-MAX aircraft, betting that travel will return to pre-pandemic levels in the coming year. United is also buying 70 aircraft from Boeing rival Airbus.
Investors also got a dose of good economic news. The Conference Board reported that its consumer confidence index rose to 127.3 in June. That was well above economists’ forecast of 119, according to FactSet.
Also, a report showed that home prices soared in April at the fastest pace since 2005 as potential buyers bid up prices on a limited supply of available properties. That lifted homebuilders. Lennar rose 1.5% and Toll Brothers rose 2%.
The big piece of economic data this week will be Friday’s jobs report for June. Economists expect U.S. employers created 675,000 jobs last month, with the unemployment rate falling to 5.7%.
