Standard & Poor’s 500, Dow close at record highs
ASSOCIATED PRESS April 10, 2013 7:16AM
In this April 8, 2013, photo, copies of President Barack Obama's budget plan for fiscal year 2014 are prepared for delivery at the U.S. Government Printing Office in Washington. Obama is sending Congress on Wednesday, April 10, his long-awaited budget, an effort to achieve an elusive "grand bargain" to tame run-away deficits that have soared above $1 trillion for each of the past four years. (AP Photo/J. Scott Applewhite)
Updated: April 10, 2013 3:21PM
NEW YORK (AP) — Stocks are closing sharply higher on Wall Street, led by gains in technology companies.
The Dow Jones industrial average rose 128 points, or 0.9 percent, to 14,802. It was the Dow’s third gain in a row.
The Standard & Poor’s 500 rose 19 points to 1,587, or 1.2 percent. The Dow and S&P both closed at record highs.
The Nasdaq composite posted even bigger gains thanks to the surge in tech stocks. That index was up 59 points, or 1.8 percent, to 3,297.
Networking equipment and semiconductor makers soared after Adtran, a network communication company, reported a surge in profits, suggesting that businesses are spending more on tech upgrades.
Three stocks rose for every one that fell on the New York Stock Exchange. Volume was average at 3.4 billion shares.
Chipmaker Intel logged the biggest percentage gain in the 30-member Dow index, rising 62 cents, or 2.8 percent, to $22.36. Cisco Systems rose 55 cents to $21.52 and Microsoft gained 60 cents to $30.21.
The information technology industry was the best performer of the 10 industry groups in the S&P 500, rising 1.9 percent. The industry has advanced just 4.7 percent, while the broader market has risen 11.4 percent.
The Nasdaq composite, which is heavily weighted with technology stocks, had the biggest percentage gain of the three main indexes, rising 51 points, or 1.6 percent, to 3,288.
The stock market is climbing again, reversing course from last week when investors’ confidence took a blow from an unexpectedly poor report on the U.S. job market and other signs that the U.S. economy slowed in March. Both the Dow and the S&P 500 index had surged in the first three months of the year and are up 13.1 percent and 11.4 percent respectively in 2013.
The markets’ weak performance recently — the Dow lost ground on three days out of five last week — could be passing. The Dow is on track for its third straight gain and its biggest one-day gain in six weeks.
Cameron Hinds, regional chief investment officer at Wells Fargo Private Bank based in Nebraska, said rising house prices, coupled with a strong stock market, are creating a virtuous circle for consumers and is bolstering investors’ confidence.
“We are starting to develop what I would call a positive confidence loop,” Hinds said. “Last year we we’re lacking in confidence.”
The S&P was up 20 points, or 1.3 percent, at 1,588 at 2:06 p.m. The Dow Jones industrial average rose 135 points, or 0.9 percent, to 14,803.
The Federal Reserve released the minutes of its March policy meeting ahead of schedule Wednesday morning. The minutes indicated that some Fed members wanted to end the bank’s stimulus program relatively soon, saying the costs likely outweigh the benefits. The Fed’s stimulus program has been one of the key factors driving stocks higher this year.
Investors may welcome signs that the economy is recovering well enough that it may no longer need support from the Fed, said Brian Gendreau, a market strategist at Cetera Financial Group.
“The idea that the Fed thinks that we are closer to the restoration of normality might be positive for the market,” said Gendreau.
Hospital management stocks fell heavily after Deutsche Bank lowered its recommendation on the companies because their prices have risen so much that they no longer offer good value. Private hospitals have surged over the past year in anticipation that health care spending will increase following the introduction of the Patient Protection & Affordable Care Act.
Health Management Associates plunged $2.13, or 17 percent, to $10.47. Tenet Healthcare fell $2.35 to $41.17 and Community Health Systems dropped $1.74 to $42.17.
The yield on the 10-year Treasury note rose to 1.79 percent from 1.75 percent late Tuesday.