Wall Street rises, S&P at another recordNEW YORK - U.S. stocks rose on Friday as some positive economic data boosted the S&P 500 to record levels for a second straight day and put major indexes on track for strong gains in both the week and the month.
By: Reuters, INFORUM
NEW YORK - U.S. stocks rose on Friday as some positive economic data boosted the S&P 500 to record levels for a second straight day and put major indexes on track for strong gains in both the week and the month.
However, a discouraging read on economic growth pointed to an economy that continues to struggle, leaving some investors to question whether valuations are justified.
The Chicago Purchasing Managers Index rose to 59.8 in February, topping expectations, while the final February reading on consumer sentiment from the Thomson Reuters/University of Michigan Surveys of Consumers also rose more than expected.
The data bucked the trend of indicators coming in below forecasts, giving credence to the theory that the recent disappointments have come on harsh weather rather than weakening fundamentals. Stocks rose on Thursday, with the S&P 500 closing at a record, after Federal Reserve Chair Janet Yellen indicated support for this theory.
Other reports released on Friday suggested an economy that struggles to gain traction. GDP was estimated to have grown at an annual rate of 2.4 percent in the quarter, the Commerce Department said. That was below estimates and down sharply both from its estimate last month of 3.2 percent and the 4.1 percent rate in the third quarter. Separately, pending home sales rose 0.1 percent in January, far below expectations for growth of 2 percent.
"The market has been giving a pass on these reports, which leaves me feeling a bit more vulnerable than I'd like, even though I do think this will end up being more about weather than weakness," said Bill Stone, chief investment strategist at PNC Wealth Management in Philadelphia, which has $125 billion in assets under management.
"Right now valuations are in that middle range, not so high that they're in a bubble or super expensive, but also not so low that they're cheap. There's not much in equities that really stands out as a beacon of opportunity."
The Dow Jones industrial average was up 100.04 points, or 0.61 percent, at 16,372.69. The Standard & Poor's 500 Index was up 11.32 points, or 0.61 percent, at 1,865.61. The Nasdaq Composite Index was up 19.09 points, or 0.44 percent, at 4,338.02.
For the month, the Dow is up 4.2 percent, the S&P is up 4.5 percent and the Nasdaq is up 5.7 percent. For the week, the Dow is up 1.6 percent, the S&P is up 1.5 percent and the Nasdaq is up 1.7 percent, on track for its fourth straight weekly rise.
Citigroup Inc said it would lower its previously announced 2013 net income from $13.9 billion to $13.7 billion due to recently discovered fraud at a unit in Mexico. Shares rose 0.1 percent to $48.76.
Salesforce.com Inc late Thursday raised its full-year revenue forecast and said it was looking to improve its adjusted operating margin. Shares fell 2 percent to $64.90.
Jos. A. Bank Clothiers Inc late Thursday rejected Men's Wearhouse Inc's revised takeover offer, calling it inadequate, though it was willing to talk about a higher bid. Shares of Jos. A. Bank rose 2.8 percent to $62 while Men's Wearhouse was up 5.5 percent at $53.21.
In testimony before the Senate Banking Committee, Yellen said it would take a "significant change" to the economy's prospects for the central bank to put plans to reduce its bond-buying program on hold.
On Friday, Dallas Federal Reserve Bank President Richard Fisher said the central bank should halt its stimulus as soon as circumstances make it possible.