U.S. stocks advanced Tuesday, with the S&P 500 Index extending its record-setting rally on broad gains in telecom and financials shares.
The large-cap index rose 0.3% to 2,496.48, its second consecutive all-time high.
Most sectors contributed to the rally, with telecommunications services leading the pack. The sector finished 1.4% higher for the day.
Financials shares rose 1.2%, with banks and capital markets companies responsible for the bulk of the increase.
Materials stocks rose 0.8% and industrials finished 0.5% higher.
Losses on Tuesday were mainly concentrated in utilities and real estate, which fell 1.8% and 1.2%, respectively.
Wall Street is riding high after powerful Hurricane Irma wreaked less damage than expected. Analysts say the monetary impact of the storm is only a fraction of what forecasters had predicted last week.
Thanks to a weaker dollar, global portfolio managers are more underweight U.S. equities than at any time since the global financial crisis. The latest survey from Bank of America Merrill Lynch showed that global fund managers’ allocation to U.S. stocks fell to a net 28% underweight, the lowest since November 2007.
At the same time, managers overweight in emerging markwt equities reached the highest level since December 2010.
The majority of fund managers also said volatility was the most undervalued asset. The CBOE VIX – Wall Street’s preferred measure of volatility – briefly fell to record lows earlier this year. It continues to trade at a fraction of the historic mean as stocks trade in record territory.
The BoA survey was conducted between September 1 and 7 and reflected the views of 181 fund managers.
S&P 500 Index