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Bets on economy lift Wall Street; banks, tech lead
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A trader works on the floor of the New York Stock Exchange, March 8, 2010.
Credit: Reuters/Brendan McDermid
NEW YORK |
NEW YORK (Reuters) - Bank and technology shares lifted Wall Street on Wednesday on hopes a revival in business demand will boost corporate profits.
Banks' shares rallied to their highest in 16 months, adding to recent momentum, amid bets an improving economy will stoke loan demand.
"The natural conclusion investors are making is, if the economy is turning, financials are poised to do well," said Angel Mata, managing director of listed equity trading at Stifel Nicolaus in Baltimore.
The Nasdaq rallied for a fifth straight day, helped by data showing U.S. wholesale inventories fell unexpectedly in January and sales hit their highest in more than a year.
"There's demand out there and (businesses) are going to have to build up those inventories," Mata said.
Chip maker Intel Corp (INTC.O) shares gained 1.2 percent to $21.19 and the PHLX semiconductor index .SOXX rose 2.2 percent.
Industrial shares ranked among the top gainers, with Boeing Co (BA.N) up 3.3 percent at $70.01.
The Dow Jones industrial average .DJI edged up 2.95 points, or 0.03 percent, to end at 10,567.33. The Standard & Poor's 500 Index .SPX rose 5.16 points, or 0.45 percent, to 1,145.61. The Nasdaq Composite Index .IXIC gained 18.27 points, or 0.78 percent, to 2,358.95.
The benchmark S&P 500 Index extended its year-long advance and is now up 69.3 percent from its 12-year closing low hit a year ago on March 9.
The more upbeat view of the economy helped lift bank stocks, with Citigroup Inc (C.N) up 3.7 percent at $3.96, and Wells Fargo & Co (WFC.N) up 2 percent at $29.57.
The KBW bank index .BKX rose 2.2 percent to its highest close since mid-November 2008, while the S&P financial sector's index .GSPF added 1.1 percent and led gains in the broader market.
In deal news, Abbott Laboratories (ABT.N) agreed to buy Facet Biotech Corp FACT.O for $27 a share late Tuesday, topping a failed bid from Biogen Idec Inc (BIIB.O).
Abbott's stock rose 0.4 percent to $55.03 on the New York Stock Exchange, while Facet soared 66.6 percent to $27.01 on the Nasdaq.
Shares of Travelers Co (TRV.N) dropped 1.3 percent to $52.89, capping the Dow industrials' advance.
About 9.56 billion shares traded on the New York Stock Exchange, the American Stock Exchange and Nasdaq, slightly below last year's estimated daily average of 9.65 billion.
Advancing stocks outnumbered declining ones on the NYSE by a ratio of about 2 to 1, while on the Nasdaq, more than eight stocks rose for every five that fell.
(Reporting by Rodrigo Campos; Editing by Jan Paschal)
Did anybody tell these guys that when you are in a hole, stop digging!
The Wall Street and FTSE morons determined to dig the hole deeper so the crash even further.
Shouldn’t these people be made to go to school so they can at least understand some basic economic? The ruined the country once and they are on their way to doing it again.
Look for more profit taking this afternoon if we get a morning rally. Low volumes can’t fight that off. The S&P 500 will see 1100 before it hits 1175
The only way Wall Street goes up any more is with Mergers and Acquisitions. All they do is reduce the number of shares out there so the same volume of money in the market ends up purchasing more shares, artificially causing the market to go up.
M&A typically results in a net loss of jobs when the two organizations are merged. It also reduces competition which causes prices to increase, hence inflation. Why bother?
Everybody’s dream right now is to become “too large to fail” in which case they can depend on the government bailing them out, at which point they can take on huge levels of risk to make boatloads of easy money.
