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Stocks At Record Highs; Tesla Leads, Nvidia Lags; How High Can Apple Go?

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The major market indexes surged to fresh highs for a third straight session as Caterpillar (CAT) and Apple (AAPL) boosted the Dow Jones industrial average. Tesla (TSLA) lifted the Nasdaq, but Nvidia (NVDA) weighed.

The Dow rallied 0.7%, while the Nasdaq composite and S&P 500 each rose 0.5%. Volume was flat on the NYSE and lower on the Nasdaq vs. Friday, according to preliminary numbers.

Fiber optics, automakers and steel producers led the upside in today's stock market action, while discount retailers, international oil explorers and apparel makers lagged. U.S. Steel (X) surged 6%, clearing a 39.24 cup-base entry in busy trade. Shares are still in buy range. Steel makers are expected to benefit from President Donald Trump's protectionist policies.

Caterpillar rose more than 2% in heavy trade, regaining a 97.50 flat-base buy point first cleared Jan. 27. Shares are still in buy range from the entry.

Apple rose nearly 1% for an all-time closing high. The stock is well-extended from a 118.12 cup-with-handle buy point cleared in early January. Goldman Sachs reiterated a buy rating and raised its price target to 150 from 133, citing growing confidence in the upgrade cycle for the iPhone 8, which is expected to be released this fall. Goldman also raised its fiscal 2018 EPS outlook to $10.69 from $10.37, well above Street consensus for $10.07.

Tesla cruised up 4% to a 19-month high in fast trade. It's now out of buy range from a 258.56 cup-with-handle entry cleared last week. Shares popped 3% Thursday in heavy volume after reports the electric car maker is planning to start test production of its Model 3 this month, ahead of its July mass-production goal.

In merger news, Zeltiq Aesthetics (ZLTQ) gapped up and soared 13% to an all-time high on news the body-contouring systems maker is being acquired by Allergan (AGN) for $2.5 billion. Allergan, which makes wrinkle treatment Botox, edged fractionally higher.

On the IBD 50, InterDigital (IDCC) and Western Alliance Bancorp (WAL) staged breakouts with gains of 2% each. InterDigital cleared a 98.10 flat-base buy point, while Western climbed past a 50.82 flat-base entry, both in above-average volume.

On the downside, Nvidia sank 4% in active turnover, extending its slide for a fourth straight session. The stock has headed south since rising above a 120.03 buy point intraday Tuesday in tepid trade.

Economic data on tap for Tuesday include the producer price index for January and the National Federation of Independent Business' small business optimism index, also for January. The Fed's Janet Yellen, Jeffrey Lacker, Dennis Lockhart and Robert Kaplan are slated to speak.

Earnings are due out from Agilent Technologies (A), Diamondback Energy (FANG), Dr Pepper Snapple (DPS), Martin Marietta Materials (MLM) and T-Mobile U.S.

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