GLOBAL MARKETS-Stocks extend rally, S&P at new high as data signals growth

Thu Aug 21, 2014 3:00pm EDT

* Spate of U.S. data provides lift to Wall Street
    * European shares, euro buoyed by robust German data
    * Crude prices rise on U.S. economic data

 (Adds oil settlement prices)
    By Herbert Lash
    NEW YORK, Aug 21 (Reuters) - Global equity markets edged
higher on Thursday, with the S&P 500 hitting a new all-time
high, as U.S. and German data drove confidence on economic
growth and helped extend a stock rally.
    Data on German private-sector growth reassured investors
about the outlook for Europe's biggest economy following a soft
patch, while a batch of U.S. reports showed economic strength
early in the third quarter.
    Markit's flash composite Purchasing Managers' Index for
Germany was 54.9 for August, well above the 50 mark that
indicates economic expansion, a relief after German GDP data
last week showed a surprise contraction in the second quarter.
 
    In the United States, home resales rose to a 10-month high
in July, factory activity in the mid-Atlantic region hit its
highest level since March 2011 in August, and a gauge of  future
economic activity grew solidly last month. 
    The benchmark S&P 500 rose as high as 1,993.53 points,
topping the prior record of 1,991.39 set in late July, and
European markets extended earlier gains. MSCI's measure of
global equity performance also rose, but its
gauge of emerging markets slipped a bit.
    "It seems that conditions reflect the best of all worlds -
U.S. economic growth that is neither too slow, which would put
pressure on earnings, nor too fast," said Terry Sandven, chief
equity strategist at U.S. Bank Wealth Management in Minneapolis.
    The Dow Jones industrial average rose 86.9 points, or
0.51 percent, to 17,066.03. The S&P 500 gained 6.73
points, or 0.34 percent, to 1,993.24 and the Nasdaq Composite
 added 4.60 points, or 0.1 percent, to 4,531.08.
    In Europe, the FTSEurofirst 300 index of top
regional shares rose 0.67 percent to close at 1,355.09 points.
    While stocks might be a tad pricey, earnings growth will
continue to support U.S. equities, said Bernie Williams, chief
investment officer of investment solutions at USAA Investments 
in San Antonio, Texas.
    "I'm a big believer that stocks follow earnings," Williams
said. "Right now the latest consensus is 8 or 9 percent earnings
growth, I think that's what propels the market going forward."
    The German data helped the euro rebound against the
dollar, rising 0.17 percent to $1.3281. Against the yen, the
dollar gained 0.11 percent to 103.84 yen. 
    U.S. Treasuries hewed to a tight range, showing little
reaction to the stronger-than-expected U.S. economic data.
Investors awaited developments from the annual meeting of
central bankers in Jackson Hole, Wyoming, which begins late
Thursday.
    A speech on Friday by Federal Reserve Chair Janet Yellen,
when she is expected talk about labor markets, is highly
anticipated by investors.
    German 10-year Bund yields held below 1
percent on bets that Yellen will signal at the Jackson Hole
central bankers' gathering that the Fed is in no hurry to raise
rates.
    Benchmark 10-year U.S. Treasuries rose 6/32 in
price to yield 2.4068 percent. 
    U.S. crude rose and Brent futures pared losses, lifted by
the U.S. economic data after a plentiful supply picture.
    Brent crude for October rose 35 cents to settle at
$102.63 a barrel, while U.S. crude rose 51 cents to
settle at $93.96 a barrel.

 (Reporting by Herbert Lash; Additional reporting by Marc Jones
in London; Editing by Leslie Adler and Chizu Nomiyama)
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