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Bank stocks lift Dow to a new record, and tech shares climb

A U.S. flag flies from the New York Stock Exchange building.

U.S. stocks resumed their climb Monday as investors bought stocks that stand to benefit from economic growth, such as banks, and picked up shares of technology companies, which have been mostly left out of a post-election rally. The Dow Jones industrial average set another record high.

Energy companies rose as the price of oil reached its highest level since July 2015. Small-company stocks continued to outpace the rest of the market.

Samantha Azzarello, global market strategist for JPMorgan Asset Management, said investors have been steadily moving money away from safer-play stocks over the past year and favoring companies that stand to do the best when economic growth picks up steam, as it did in the third quarter. Azzarello said investors expect that trend to continue.

“We've had 2 to 2.5% growth in the U.S. and we expect that to pop even higher if we get fiscal stimulus,” she said.

The Dow Jones industrial average rose 45.82 points, or 0.2%, to 19,216.24. Earlier in the day it was as high as 19,274. The Standard & Poor's 500 index climbed 12.76 points, or 0.6%, to 2,204.71. The Nasdaq composite advanced 53.24 points, or 1%, to 5,308.89.

Stocks of small and mid-sized companies rose sharply. The Russell 2000 index jumped 23.53 points, or 1.8%, to 1,337.79. Thanks to a big rally in November, the Russell is up 18% this year, more than twice as much as the S&P 500, which tracks large U.S. companies. Smaller companies, which are more domestically focused than large multinationals, could stand to benefit more than larger ones from a pickup in U.S. growth.

Banks resumed their post-election rally and are trading at their highest levels since early 2008. Goldman Sachs rose 2.3% to $228.55, a nine-year high. Although stocks overall traded lower last week, banks are on a four-week winning streak.

Technology companies have fallen since the November election as big names such as Facebook and Alphabet have lost ground. But that changed Monday.

Microsoft rose 1.6% to $60.22, and customer-management software developer climbed 3.5% to $70.80. Graphics chipmaker Nvidia advanced 3.9% to $91.88.

Tech stocks are still down about 1% since the election as investors have wondered about the effects of President-elect Donald Trump's potential trade policies. The stocks had also reached all-time highs earlier this year.

Oil prices rose for the fourth day in a row. The price of oil has surged since OPEC countries finalized a deal to trim oil production starting in January. Benchmark U.S. oil rose 11 cents to $51.79 a barrel. Brent crude, used to price international oils, rose 48 cents to $54.94 a barrel.

That sent energy companies higher. Valero Energy jumped 5% to $64.52 and ConocoPhillips went up 1.6% to $48.88.

Consumer-focused companies also did better than the rest of the market. Amazon climbed 2.6% to $759.36.

Read more: Amazon's new convenience store has no cash registers and no checkout lines »

Healthcare stocks took the biggest losses. Health insurer UnitedHealth, a Dow component that has soared since the election, fell 1.9% to $157.63 and drugmaker Merck declined 1.4% to $60.25.

Kite Pharma, however, rose 5.6% to $53.62 after the Santa Monica drug developer reported encouraging results from early clinical studies of a leukemia treatment.

U.S. government bond prices mostly recovered from a sharp drop earlier in the day and finished just a bit lower. The yield on the benchmark 10-year Treasury note edged up to 2.40% from 2.39%.

Italian voters rejected proposed changes to the nation's constitution Sunday, causing political and economic uncertainty for Europe's fourth-largest economy. Premier Matteo Renzi said he would resign. UniCredit, the biggest bank in Italy, lost 3% in Milan. Monte dei Paschi di Siena, the country's third-biggest lender, slumped 4%. The bank failed a stress test this year and has been in negotiations with investors to raise money to shore up its financial position.

Read more: In a populist victory, Itay's Renzi says he's resigning »

Italian stocks didn't move much overall. The FTSE MIB index slipped 0.2%.

Azzarello of JPMorgan said that's because investors are getting used to political surprises. “After ‘Brexit’ and after the U.S. election, markets are now braced for expecting the most extreme outcome when it comes to politics,” she said.

Other major European indexes finished higher. Germany's DAX advanced 1.6% and France's CAC-40 gained 1%. In London the FTSE 100 rose 0.2%. Asian stocks mostly fell. Tokyo's Nikkei 225 retreated 0.8%. The Hang Seng in Hong Kong lost 0.3%.

Also on Sunday, the Army Corps of Engineers denied a permit for the Dakota Access oil pipeline in North Dakota. The Standing Rock Sioux tribe and its supporters say the proposed route for the pipeline threatens the tribe's water source and cultural sites. It's not clear if the Trump administration will try to overturn the decision after Trump takes power in January.

Read more: Army halts Dakota Access pipeline: 'Today, the voices of indigenous people were heard' »

The companies connected to the pipeline traded lower Monday. Energy Transfer Partners fell 1.7% to $33.79 and Sunoco Logistics slid 1.9% to $22.75. Those two companies recently agreed to combine.

The dollar rose to 113.75 yen from 113.67 yen. The euro rose to $1.0770 from $1.0660.

Wholesale gasoline remained at $1.56 a gallon and heating oil was flat at $1.66 a gallon. Natural gas jumped 22 cents, or 6.3%, to $3.65 per 1,000 cubic feet.

Gold fell $1.30 to $1,176.50 an ounce. Silver rose 7 cents to $16.90 an ounce. Copper jumped 7 cents, or 2.8%, to $2.70 a pound.

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