Dow Jones: 12,763.31 (+72.35) S&P 500: 1,360.48 (+4.82)) Nasdaq: 2,872.53 (+2.65)US STOCKS rose yesterday, sending the Standard and Poor's 500 Index to the highest level since June 2008, as better than estimated corporate earnings tempered investors' concern over slowing economic growth.
Insurers led gains as Allstate, Aflac and Lincoln National posted earnings that topped estimates.
Sprint Nextel rallied 6.7 per cent as the third-largest US mobile-phone carrier reported a narrower loss after paring costs to offset contract-customer defections.
Constellation Energy rose 5.7 per cent as Exelon offered $7.9 billion to buy the power producer.
Boeing gained 3.2 per cent as Citigroup raised its share-price estimate.
Procter Gamble lowered the high end of its profit forecast as it trimmed expenses and increased prices to offset rising materials costs. Its shares rose 0.8 per cent at $64.50.
The S&P 500 climbed 0.4 per cent to 1,360.48 at the close in New York.
The Dow Jones Industrial Average increased 72.35 points, or 0.6 per cent, to 12,763.31.
“Corporate America has managed to do very well in this environment of sluggish growth,” said Randy Bateman, chief investment officer of Huntington Asset Management in Columbus, Ohio, which oversees $14.4 billion.
“Earnings are beating estimates. Companies are adding value to their shareholders. There are just not that many alternatives that can compete with corporate America at this point,” he said.
Benchmark gauges reversed early losses yesterday as a report showed the number of Americans signing contracts to buy previously owned homes rose more than forecast in March, a sign the industry that triggered the recession may be stabilizing.
A report showed new applications for unemployment benefits in the US rose last week to the highest level in three months, a sign progress in the labour market may be stalling.
“It’s very clear that it’s going to be harder and harder to beat estimates from here,” said Quincy Krosby, a market strategist for Newark, New Jersey-based Prudential Financial, which oversees $784 billion.
“You’re going to see the leading economic indicators weaken, albeit from a high level,” he added. – (Bloomberg/Reuters)
