Dow, S&P end at records, stocks mark fourth week of gains

NEW YORK Fri May 17, 2013 6:01pm EDT

1 of 2. Traders work on the floor at the New York Stock Exchange, May 16, 2013.

Credit: Reuters/Brendan McDermid

NEW YORK (Reuters) - Stocks continued their climb into uncharted territory on Friday, racking up the fourth week of gains in a row as encouraging economic data prompted investors to pick up shares of growth companies.

The Dow and the S&P 500 finished at fresh record highs, driven by gains in energy and industrial shares. The indexes have pushed to a series of never-before-seen levels as part of the rally that has lifted equities more than 16 percent for the year so far.

In a sign of how far the market has come, the S&P 500 is also about 1,000 points above the low hit in March 2009 in the wake of the credit crisis and recession. Shares picked up strength late in the day on Friday, with the S&P 500 rising 1 percent not long before the closing bell.

"It's hard to hold this market down," said Michael Sheldon, chief market strategist at RDM Financial in Westport, Connecticut.

Data showed Americans felt better about their economic and financial prospects in early May, with consumer sentiment at its highest in nearly six years, while a gauge of future economic activity rose in April to a near five-year high.

"If you believe the economy is going to gradually get better and that global growth will improve, the parts of the market that have not benefited so far, like cyclicals, will probably be the next group to outperform," Sheldon said.

Boeing (BA.N) shares led the S&P 500's industrial sector index .SPLRCI higher with a 2.4 percent advance to $98.92, its highest since October 2007. The S&P industrial index rose 1.4 percent.

The S&P energy sector index .SPNY gained 0.8 percent, with Exxon Mobil (XOM.N) up 1.2 percent at $91.76.

The rate of growth in the U.S. economy has been expected to slow in the second quarter as tighter fiscal policy starts to bite. But recent improvement, including in the labor market and retail sales, has suggested the recovery remains resilient.

As slow as it is, "we are still recovering," said Doreen Mogavero, CEO of Mogavero, Lee & Co in New York. "The U.S. (market), for all its woes, is still the best place to be at this moment."

The Dow Jones industrial average .DJI gained 121.18 points, or 0.80 percent, to close at a record 15,354.40. The Standard & Poor's 500 Index .SPX rose 15.65 points, or 0.95 percent, to end at a record 1,666.12. The Nasdaq Composite Index .IXIC climbed 33.72 points, or 0.97 percent, to finish at 3,498.97 - its highest close since October 2000.

Earlier in the session, the Dow touched an all-time intraday high at 15,357.40, while the S&P 500 rose to a record intraday high at 1,667.38.

For the week, the Dow advanced 1.6 percent, while the S&P 500 climbed 2 percent and the Nasdaq rose 1.8 percent.

For the year so far, the Dow has climbed 17.2 percent, while the S&P 500 has gained 16.8 percent and the Nasdaq has advanced 15.9 percent.

JPMorgan raised its year-end target for the S&P 500 to 1,715 from 1,580, implying a gain of just under 3.5 percent for the index for the rest of the year.

"We realize investors are apprehensive about making fresh money purchases, but we see the risk/reward as particularly attractive in Technology, Healthcare, and Financials," said the client note from JPMorgan's U.S. equity strategist Thomas Lee.

General Motors Co (GM.N) rose 3.2 percent to $33.42, breaking above its 2010 initial public offering price of $33 for the first time since May 2011. CLSA raised its rating on the automaker's stock to "buy" from "underperform." [ID:nL2N0DY0TJ]During Friday's session, GM's stock hit a 52-week high at $33.77.

JCPenney (JCP.N) shares lost 4.2 percent to $18.01 after the retailer reported another steep quarterly loss on weak sales and heavy clearance deals, and Chief Executive Myron Ullman cautioned he needs time to fix the company's problems.

Tableau Software (DATA.N) surged in its first day of trading as investors bet the rising interest in big data will drive the data analysis software maker's growth. Tableau surged 63.7 percent to $50.75.

S&P Dow Jones Indices said after the close on Thursday that S&P MidCap 400 .MID component Kansas City Southern (KSU.N) will replace Dean Foods Co (DF.N) in the S&P 500. Kansas City Southern shares gained 0.8 percent to $117.16, while Dean Foods rose 1.8 percent to $20.95.

Aruba Networks Inc (ARUN.O) plunged 25.6 percent to $13.10 after the network equipment maker released fourth-quarter results well below Wall Street's expectations, hurt by rising competition from Cisco Systems Inc (CSCO.O).

Volume was roughly 6.33 billion shares on the New York Stock Exchange, the Nasdaq and the NYSE MKT, not far off the year-to-date average daily closing volume of 6.34 billion.

Advancers outnumbered decliners on the NYSE by a ratio of about 21 to 8. On the Nasdaq, 17 stocks rose for every eight that fell.

(Additional reporting by Rodrigo Campos; Editing by Jan Paschal)

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see http://blogs.reuters.com/fulldisclosure/2010/09/27/toward-a-more-thoughtful-conversation-on-stories/
Comments (3)
yieldcurve wrote:
Another Berrnanke bubble.

May 17, 2013 5:40pm EDT  --  Report as abuse
Dragos111 wrote:
Yep, we can all feel wealthier now. The markets are at new highs.

But, you know how you make stock markets go up this way? You devalue the dollar. If the dollar buys only half of what it bought before, it takes twice as many dollars to buy the same assets that it did before. Likewise, if the dollar is worth less now, it takes more dollars to buy the same number of Apple shares that it took to buy them before. Since the stock prices are measured in dollars, if it takes more dollars to buy the same shares, it looks like the “value” is going up. In fact, the “real” value of the market is going nowhere. In fact, all the dollars you have saved are actually losing value.

All the government money printing is only making things look good. The reality is an entirely different picture.

May 17, 2013 9:21pm EDT  --  Report as abuse
LH56 wrote:
Buy gold, put your money in your mattress, the end is near! It must really hurt to have cashed in when the market hit the 7000′s and then sat and watched as all the dire predictions about Obama never materialize, while missing out on this recovery. Now all they can do is to keep trying to convince people of impending doom and hope that it happens so they can feel better about their panic moves and not have to admit how much better things are after the Bush debacle.

May 17, 2013 11:33pm EDT  --  Report as abuse
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.