Donald Trump's plans take Dow to a new record

NEW YORK: Donald Trump's vows to ramp up infrastructure spending and ease banking regulations are giving a burst to the Dow Jones Industrial Average that's sending it rocketing past the broader market.

The 120-year-old stalwart of the US equity market powered to and closed at a fresh record on Monday as the S&P 500 Index hovered nine points below its own all-time high and traded near its biggest discount to the Dow since May 2014.

The two indexes are the least correlated in almost six years as the blue-chip measure benefits from the burnished outlook for industrial companies and banks ushered in by Trump's win, while losses in technology companies and utilities tug at the S&P 500.


Speculation the president-elect's agenda will favour US manufacturers and big factory employers has lit a fire under the Dow, which counts industrial stocks like General Electric Co and Boeing Co as its biggest sector with a 20% weighting.

They're less than 11% of the S&P 500. The Dow is set to outperform its broader counterpart on an annual basis for the first time since 2011, rallying 10% this year, while the S&P 500 has climbed 7.9%.

The day before the election, they were pretty much neck-and-neck, with the Dow up 4.8% in 2016 and the S&P 500 headed for a yearly advance of 4.3%.

The 7.9% climb in US industrial stocks since November 7 is second only to the 15% surge racked up by financial shares, with banks buoyed by plummeting bond yields.