* Microsoft jumps nearly 4 pct and leads the Dow's advance
* Alcoa tops profit expectations, early earnings have been
* Solar companies have bright day after First Solar outlook
* Department store J.C. Penney's stock falls after CEO
* Dow up 0.4 pct, S&P 500 up 0.4 pct, Nasdaq up 0.5 pct
By Ryan Vlastelica
NEW YORK, April 9 U.S. stocks advanced on
Tuesday, with the Dow closing at a record high on a rally in
cyclical shares and as earnings season started to heat up.
With the day's advance, the S&P 500 again neared its
all-time intraday high of 1,576.09, recovering from steep losses
last week, the index's worst of 2013.
The return to near-record levels indicates that investors
are again using market declines as buying opportunities. The top
sectors of the day, technology and energy, are groups that are
closely tied to the pace of economic growth.
"It's encouraging that we're seeing cyclical sectors lead
the rally. It's a healthy sign - investors believe the market
can continue to run higher," said Joseph Tanious, global market
strategist at J.P. Morgan Funds in New York.
Among blue-chip technology stocks, Microsoft Corp
jumped 3.6 percent to $29.61 as the Dow's top percentage gainer.
Intel Corp shares shot up 3.1 percent to $21.75 while
Hewlett-Packard rose 1.3 percent to $22.22. The S&P
technology sector advanced 0.8 percent while the
Philadelphia semiconductor sector gained 0.9 percent.
An S&P index of energy shares rose 0.8 percent,
climbing alongside a rise of 0.9 percent in the price of U.S.
crude oil, which was up on inflation data from China that
reduced concerns about monetary tightening. Halliburton Co
rose 1.8 percent to $39.11 and Chevron Corp
gained 0.7 percent to $118.64.
The Dow Jones industrial average advanced 59.98
points, or 0.41 percent, to 14,673.46, a record closing high.
The Standard & Poor's 500 Index gained 5.54 points, or
0.35 percent, to 1,568.61. The Nasdaq Composite Index
added 15.61 points, or 0.48 percent, to close at 3,237.86.
The Dow also touched a record intraday high at 14,716.46.
Stocks also got a boost from a promising start to the
earnings season. While only 5 percent of S&P 500 companies have
reported results so far, almost three-quarters of them have
topped expectations, according to Thomson Reuters data. Still,
profits are seen rising just 1.5 percent from a year-ago
quarter, down from estimates in January for growth of 4.3
"Expectations have gotten managed down to the point where we
could more easily see companies beat expectations, making it
easier for us to pop," said Kristen Scarpa, a New York-based
investment strategist at Barclays, which has a year-end target
of 1,595 for the S&P 500.
Late Monday, Alcoa Inc reported adjusted earnings
that beat expectations, though revenue was below forecasts.
Shares of Alcoa, which as the first Dow component is
unofficially seen as setting the tone for the earnings season,
closed flat on the day at $8.39.
There have been 4.7 negative first-quarter preannouncements
for each positive one, according to Thomson Reuters data, the
worst ratio since the third quarter of 2001.
Bucking that trend, however, was First Solar Inc,
which surged 45.5 percent to $39.35 as the S&P 500's top gainer
by far after forecasting 2013 earnings and revenue well above
The news lifted the solar sector, with Yingli Green Energy
climbing 21 percent to $2.24 and Trina Solar up
14.6 percent at $4.40. The Market Vectors Solar Energy ETF
rose almost 13 percent to $40.68.
About 56 percent of the shares traded on the New York Stock
Exchange closed in positive territory. In contrast, 53 percent
of Nasdaq-listed shares closed lower.
Volume was light, with about 5.71 billion shares changing
hands on the New York Stock Exchange, the Nasdaq and NYSE MKT,
below the daily average so far this year of about 6.48 billion
Recent data have shown the U.S. economy is growing but at a
slow pace. The March payrolls report showed jobs creation was
less than half of what economists had expected. Analysts said,
however, that the market has the momentum to push indexes
higher, even with the Dow Jones industrial average up about 12
percent and the S&P 500 up about 10 percent for the year.
J.C. Penney was the S&P 500's largest percentage
loser, tumbling 12.2 percent to $13.93 after the department
store's board ousted Chief Executive Ron Johnson and replaced
him with his predecessor.
Though Penney's board may not face serious legal challenges,
shareholders may question whether the move to replace Johnson
with Myron Ullman, who Johnson himself replaced in late 2011, is
good for them.
Shares of nutritional company Herbalife fell 3.8
percent to $36.95 after the company announced KPMG had resigned
as Herbalife's independent accountant after one of its senior
partners engaged in insider trading in Herbalife stock.
Earlier, the stock was halted from trading after the New
York Times reported KPMG would resign.