3 Min Read
* Factory data shows expansion
* S&P hits record high
* Medicines Co tumbles after court ruling
* Indexes up: Dow 0.43 pct, S&P 0.42 pct, Nasdaq 1.17 pct (Updates to open; adds data, quote)
By Chuck Mikolajczak
NEW YORK, April 1 (Reuters) - U.S. stocks opened the second quarter on a higher note on Tuesday, with the S&P 500 hitting a record high, after data on manufacturing indicated economic growth was gaining traction after a harsh winter.
The Institute for Supply Management (ISM) said its index of national factory activity rose to 53.7 in March, its second straight monthly acceleration, from February's read of 53.2 but below the median forecast of 54.0.
"Basically in line (with expectations), but again it shows we are coming out of this winter chill," said Peter Cardillo, chief market economist at Rockwell Global Capital in New York.
"Economic growth is going to accelerate in the coming months and confirm the slowdown we had in the first quarter was related to weather factors."
Financial data firm Markit said its final U.S. Manufacturing Purchasing Managers Index slipped to 55.5 in March from 57.1 in February, unchanged from a preliminary reading last week, and the rate of growth and the pace of hiring remained strong.
Construction spending, however, edged up 0.1 percent in February as outlays on private residential construction projects recorded their biggest decline in seven months.
The S&P 500 rose 1.3 percent for the first quarter, matching its longest quarterly winning streak since 2007, buoyed by gains Monday after Federal Reserve Chair Janet Yellen soothed concerns about an earlier-than-expected rate hike.
The Dow Jones industrial average rose 70.94 points, or 0.43 percent, to 16,528.6, the S&P 500 gained 7.88 points, or 0.42 percent, to 1,880.22 and the Nasdaq Composite added 49.098 points, or 1.17 percent, to 4,248.092.
Large-cap technology stocks helped lift the Nasdaq, with Google Inc up 2 percent to $1,136.42 and Microsoft Corp up 1.1 percent at $41.44 - both among the biggest boosts to the Nasdaq 100 index.
Intuitive Surgical Inc jumped 9.1 percent to $477.89 as the best performer on the S&P 500 after the company said the U.S. Food and Drug Administration gave marketing clearance for the company's da Vinci Xi Surgical System. The NYSEArca biotech index gained 2 percent.
Medicines Co tumbled 14.9 percent to $24.18 in premarket trading. The company said the U.S District Court of Delaware ruled a generic version of its blood thinner made by Hospira Inc did not infringe two of Medicine Co's patents. Hospira shares gained 1.5 percent to $43.91. (Editing by Bernadette Baum)