NEW YORK, July 3 (Reuters) - U.S. market watchers on Monday received a bullish sign to kick off the second half of the year as the closely followed Dow transports set an all-time intraday record high for the first time since March 1.
The Dow Jones Transport Average index, which includes airlines, railroads and package delivery companies, is often viewed as a barometer of economic activity.
The 20-component index eclipsed its March 1 intraday record of 9,639.33, rising as high as 9,672.62 in morning trading. Among the stocks giving the index the biggest lift were tank barge operator Kirby Corp, freight and logistics company Landstar System and package delivery company FedEx Corp .
Should the index finish on Monday above its March 1 closing high of 9,593.95, it would be a positive sign for the market’s trend, said Chuck Carlson, chief executive officer at Horizon Investment Services in Hammond, Indiana.
”If people are looking for validation that the economy is still on pretty solid footing and can continue to kind of accelerate, that’s a good sign to see,” said Carlson, a contributing editor to the Dow Theory Forecasts newsletter.
Dow Theory tracks the transports and the Dow Jones Industrial Average to confirm major trends in the stock market.
While the Dow Jones Industrial Average has been setting successive record highs over the past six weeks, the transports slumped after March 1 and only recently surged back to record territory.
A new closing high for the transports would reconfirm the bull market trend, which “emboldens investors to buy the dips,” said Carlson.
The transports’ 1.1 percent gain on Monday, a shortened trading day ahead of the July 4 holiday, came on a generally higher day for the broader market. The benchmark S&P 500 was up 0.5 percent and the Dow industrials gained 0.9 percent, while a decline in the technology sector dragged the Nasdaq Composite lower.
The Dow industrials’ 8 percent rise in the first six months of the year marked their best first-half performance since 2013. (Reporting by Lewis Krauskopf; Editing by Dan Grebler)