U.S. Stocks Climb; S&P 500 Tops 1400 for First Time in 3 Months -- GFC 7/5 10/1 5/12==BayCRASH

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Date Posted: 00:41:18 08/09/12 Thu
Author: On Tuesday 7/8/2012 US Time
Subject:

U.S. Stocks Climb; S&P 500 Tops 1400 for First Time in 3 Months

U.S. Stocks Climb; S&P 500 Tops 1400 for First Time in 3 Months
08/08/2012 5:48AM

--Dow rises for third-straight day

--S&P 500 tops 1400 for first time in three months

--Fed official's comments, earnings buoy sentiment

By Matt Jarzemsky

NEW YORK--The Standard & Poor's 500-stock index headed for its first close above 1400 in three months, after a Federal Reserve official called for additional central bank stimulus.

The Dow Jones Industrial Average climbed 65 points, or 0.5%, to 13183 in late-afternoon trading, rising for a third consecutive session.

The S&P 500 rose eight points, or 0.6%, to 1402, topping the psychologically significant 1400 level for the first time since early May. Energy and materials shares led the advance, while defensive sectors such as telecommunications and utilities lagged.

The Nasdaq Composite Index advanced 28 points, or 0.9%, to 3018.

Federal Reserve Bank of Boston President Eric Rosengren the Fed should launch an aggressive open-ended bond-buying program to boost the economy until unemployment begins falling again. Mr. Rosengren isn't a voting member this year of the Fed's policy-setting committee.

"There's no major corporate news out, no big economic headlines. You combine that with the prospect of potential action from the Federal Reserve, and it's helping the market grind higher," said Frank Ingarra, head trader at NorthCoast Asset Management.

On the economic front, U.S. consumer credit expanded in June at the slowest pace in eight months, according to a Federal Reserve report. The increase was less than economists expected as Americans cut revolving credit, which includes credit-card debt.

The Labor Department reported the number of job openings at the end of June ticked up from a month earlier to 3.8 million, while the hiring rate was essentially unchanged.

European markets edged mostly higher, with the Stoxx Europe 600 up 0.7%, as investors shook off weak data and a plunge in the shares of U.K. lender Standard Chartered.

London-listed shares of the firm tumbled after the New York State Department of Financial Services alleged that a unit at the bank handled at least $250 billion in illegal transactions with Iranian entities. The bank said it "strongly rejects" the allegations.

In Germany's manufacturing sector, incoming orders fell more than expected in June. U.K. industrial production slumped 2.5% in June after rising 1% in May.

Asian markets were broadly higher, with Japan's Nikkei Stock Average advancing 0.9%, after the Bank of Japan extended measures encouraging companies to buy foreign assets in order to curb yen strength.

Crude-oil futures added 1.6% to settle at $93.67 a barrel, while gold futures eased 0.2% to $1,609.70 an ounce. The U.S. dollar fell against the euro but gained ground versus the yen.

In the corporate arena, shares of Fossil surged 31%, leading the S&P 500, as the fashion-accessories retailer reported an unexpected increase in second-quarter profit.

Of the 425 companies in the S&P 500 that have reported earnings for the latest quarter as of Tuesday morning, 64% have topped analysts' expectations, slightly above the 10-year average of 62%, according to S&P Capital IQ.

"It just seems to be a slightly more favorable environment for earnings and equities in general," said Jack Ablin, chief investment officer at the Harris Private Bank, which manages $60 billion.

Chesapeake Energy, the country's second-largest natural-gas producer, jumped 8.8% on higher-than-expected revenue and asset-sale plans.

Johnson & Johnson slipped 0.8% and Pfizer eased 1.7% after the drug makers said they were discontinuing development of an Alzheimer's treatment because of recent disappointing results in a late-stage trial.

Hospital operator Tenet Healthcare climbed 7.9% after its bottom line topped analysts' expectations.

Knight Capital rose 1.3%, trimming Monday's 24% loss, which had followed the struggling trading firm's announcement of a costly rescue plan to cover $440 million in trading losses tied to a software error.

Write to Matt Jarzemsky at matthew.jarzemsky@dowjones.com

(END) Dow Jones Newswires

August 07, 2012 15:48 ET (19:48 GMT)

Copyright (c) 2012 Dow Jones & Company, Inc.

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