Banks and other financial companies led U.S. stocks mostly higher Thursday, propelling the Dow Jones industrial average to a record high.
The Standard & Poor's 500 index, a broader measure of the stock market, also eked out a gain, adding to the Wednesday rally that followed Donald Trump's victory in the presidential election. The Nasdaq composite closed lower, weighed down by a slide in technology companies. Bond prices slumped again, sending yields higher.
"You are seeing a massive swing out of cash and fixed-income and into equities to take advantage of this pro-growth cycle that the market believes we're beginning," said David Lyon, global investment specialist at J.P. Morgan Private Bank.
The Dow climbed 218.19 points, or 1.2%, to 18,807.88. That's up about 1% from its previous record high, set Aug. 15. The S&P 500 index rose 4.22 points, or 0.2%, to 2,167.48. The Dow and S&P 500 index are on a four-day winning streak.
The tech-heavy Nasdaq fell 42.28 points, or 0.8%, to 5,208.80.
Investors continued to make moves based on the bevy of possible policy changes that the Trump administration could implement once it takes over in January. Those include cutting taxes, increasing infrastructure spending and slashing government regulation of businesses.
That's particularly given a boost to financial, industrial and healthcare stocks, while prompting traders to sell consumer goods companies, utilities and phone companies. Investors have also continued to pull out of bonds in anticipation that Trump's policies could usher in a stronger economy and, possibly, higher inflation, both of which are bad for bonds.
The sell-off in bonds continued Thursday, sending bond prices lower and kicking the yield on the 10-year Treasury note up to 2.15%, the highest it has been since January, from 2.06% late Wednesday. That yield is a benchmark used to set interest rates on many kinds of loans, including home mortgages.
Traders have been selling bonds more aggressively to hedge against the possibility that interest rates, which have been ultra-low for years, could rise steadily again under Trump's administration.
That scenario would favor banks and other financial companies, one reason that sector continued to rally Thursday. Higher interest rates help banks earn more money from lending, and years of ultra-low rates have crimped profits at big banks.
JPMorgan Chase led the 30 companies in the Dow, climbing 4.6% to $76.65. It was followed by Goldman Sachs, which rose 4.3% to $200.87. Wells Fargo jumped 7.6% to $51.63 and Discover Financial Services advanced 5.5% to $63.60.
Traders also bid up Macy's and Kohl's after the retailers reported their latest quarterly results. Macy's shares rose 5.6% to $40.53. Kohl's was the biggest gainer in the S&P 500, jumping 11.5% to $50.97.
Some big names in the technology sector closed lower. Netflix slumped 5.5% to $115.42, Amazon.com slid 3.8% to $742.38, and Microsoft fell 2.4% to $58.70.
Shares in several phone companies also slumped. AT&T fell 2.3% to $36.57, while Verizon slid 2.4% to $46.69.
The major stock indexes in Europe turned lower after an early rally. Germany's DAX slipped 0.1%, while the CAC-40 in France fell 0.3%. Britain's FTSE 100 lost 1.2%. Optimism that Trump's election will improve U.S.-Russia relations helped lift the Micex index in Moscow 0.9%.
Markets in Asia fared better: Japan's benchmark Nikkei 225 index rocketed 6.7% after Wednesday's slide of 5%. South Korea's Kospi advanced 2.3% and Hong Kong's Hang Seng added 1.9%. Australia's S&P/ASX 200 surged 3.3%.
Crude oil prices declined. Benchmark U.S. crude fell 61 cents, or 1.3%, to $44.66 a barrel in New York. Brent crude, used to price international oils, dropped 52 cents, or 1.1%, to $45.84 a barrel in London.
Other energy futures also closed lower. Wholesale gasoline slid 2 cents to $1.34 a gallon. Heating oil fell a penny to $1.44 a gallon. Natural gas sank 6 cents, or 2.2%, to $2.63 per 1,000 cubic feet.
Gold fell $7.10 to $1,266.40 an ounce. Silver rose 36 cents, or 2%, to $18.74 an ounce. Copper rose 9 cents, or 3.7%, to $2.55 a pound.
In currency trading, the dollar continued to strengthen. The U.S. currency rose to 106.83 yen from Wednesday's 105.84 yen, while the euro slid to $1.0890 from $1.0930.
The Mexican peso continued to weaken against the dollar. One dollar bought 20.61 pesos Thursday, up from late Wednesday's 19.87 pesos. Investors worry that Trump's anti-immigration stance and intention to repeal a trade pact with Mexico could hurt that country's economy.