S&P 500 ends at record closing high

NEW YORK Thu Mar 28, 2013 6:21pm EDT

1 of 2. Traders work on the floor at the New York Stock Exchange, March 28, 2013.

Credit: Reuters/Brendan McDermid

NEW YORK (Reuters) - The S&P 500 set a record closing high on Thursday, finishing a fifth consecutive month of gains to extend a four-year rally.

The S&P had hovered near its record for more than two weeks, and market action next week will help determine if this is just another stepping stone for the rally, or if a long-expected pullback is in the offing.

The benchmark S&P 500 closed its strongest quarter in a year - up 10 percent. The Dow climbed 11.3 percent and the Nasdaq gained 8.2 percent for the first three months of the year.

The new closing high "is a very appropriate punctuation for a great quarter that saw a lot of last year's anxieties recede," said Bruce McCain, chief investment strategist at Key Private Bank in Cleveland.

"However, this could be the start to a more realistic look at the problems that still haven't gone away. Some degree of caution is probably still merited, with the problems in Cyprus probably only the beginning to what we could see in coming months."

The rally hit a wall in the last two weeks as the latest chapter in the euro-zone crisis developed, with Cyprus nearing a default and a possible exit from the euro bloc.

The S&P 500 had been in a fairly tight range, having traded within 10 points of the October 9, 2007, record closing high of 1,565.15 over the previous 13 sessions.

On Thursday, the S&P 500 .SPX gained 6.34 points, or 0.41 percent, to end at a new record of 1,569.19.

The Dow industrials, which surpassed its 2007 record on March 5 and has set a series of record highs since then, ended Thursday's session at yet another nominal closing high - at 14,578.54. For the day, the Dow rose 52.38 points, or 0.36 percent.

The Nasdaq Composite .IXIC added 11 points, or 0.34 percent, to close at 3,267.52.

The gains in the three first months of the year have a very bullish history. An analysis by Ryan Detrick, senior technical strategist at Schaeffer's Investment Research in Cincinnati, showed the S&P 500 has risen in the three first months of the year nine times in the past 30 years, and in each case, it has posted gains for the year.

The average yearly gain after such a start, the data showed, was 17.56 percent. An advance like that would leave the S&P 500 at about 1,676 at the end of this year.

"The key is the follow-through," said Quincy Krosby, market strategist at Prudential Financial in Newark, New Jersey.

"It will be very important how the market handles next week's data."

Key manufacturing numbers are expected on Monday and factory orders Tuesday, building up to Friday's widely followed payrolls report.

During March, the Dow gained 3.7 percent, the S&P 500 rose 3.6 percent and the Nasdaq added 3.4 percent.

Thursday marked the end of the trading week. U.S. stock markets will be closed on Friday because of the Good Friday holiday.

Netflix (NFLX.O) was the S&P 500's best-performing stock during the first quarter, up 104.4 percent at $189.28, followed by Best Buy (BBY.N), up 86.9 percent at $22.15.

On the downside, Cliffs Natural Resources (CLF.N) tumbled 50.7 percent in the first quarter to $19.01 and J.C. Penney (JCP.N) lost 23.3 percent to $15.11.

Data showed the number of Americans filing new claims for unemployment benefits rose more than expected last week, but probably not enough to suggest a faltering in the labor market's recovery. Other data showed the economy expanded more in the fourth quarter than was previously estimated by the government.

Volume was lighter than average with some market participants absent for the observance of Passover or to get an early start on the long Easter weekend.

About 5.8 billion shares changed hands on the New York Stock Exchange, the Nasdaq and NYSE MKT, below the daily average so far this year of about 6.4 billion shares.

On the NYSE, advancers outnumbered decliners by a ratio of roughly 8 to 5. On the Nasdaq, 14 stocks rose for every 11 that fell.

(Reporting by Rodrigo Campos, Chuck Mikolajczak and Ryan Vlastelica; Editing by Jan Paschal)

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Comments (3)
grampy01238 wrote:
Good milestone, but don’t get too excited. This only means that the 401k contribution you made 6 years ago is now back to the same dollar value. You are still behind by inflation, or by lost opportunity had you bought 5% CD’s available at that time. We need another 30% or more to make the equities growth match the assumptions our financial planners have been using in our retirement portfolios.

Mar 28, 2013 11:50am EDT  --  Report as abuse
TheNewWorld wrote:
@grampy01238

Shhh. The simple minds want to believe that we are better off now than we ever were.

Mar 28, 2013 4:46pm EDT  --  Report as abuse
joelund wrote:
The interest rate policies are aimed at softening the effect that the crumbling economies of Europe and Asia are experiencing. The Federal Reserve is pumping liquidity into the international markets specifically. In the U.S. the Fed is actually withdrawing liquidity. The overwhelming and immediate concern is to prevent the disorderly collapse of the Chinese and European Stock markets. These truths will not be explained by the Lamestream Media or it’s paid stooges. CNBC, Bloomberg, and all the rest of the insider media outlets are toasting to the ignorance of all the Sheeple they sell their lie’s and UN-truths. Most people could care less just as long as they see an improvement in there 401k balance. Nobody wants the truth.

Mar 28, 2013 6:13pm EDT  --  Report as abuse
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