US Stocks Rise Over Optimism Progress
Financeroll – US stocks advanced for a fifth straight day, giving the Standard & Poor’s 500 Index its longest rally since July, amid optimism that European leaders will make further progress on controlling its debt crisis.
All 10 groups in the S&P 500 rallied as gains were led by consumer discretionary and utility companies. Home Depot Inc. and Boeing Co. added at least 1.2 percent, pacing gains in the Dow Jones Industrial Average. Research In Motion Ltd. (RIMM), the maker of the BlackBerry smartphone, tumbled 20 percent as its earnings report disappointed investors.
The S&P 500 rose 0.6 percent to 1,216.49 at 10:01 a.m. New York time, gaining 5.4 percent in five days. The Dow Jones Industrial Average added 61.30 points, or 0.5 percent, to 11,494.48 today.
“You could see this market just grind its way higher,” Dan Veru, chief investment officer at Fort Lee, New Jersey-based Palisade Capital Management LLC, said in a telephone interview. The firm manages $3.4 billion. “Sentiment has gotten too negative. There’s a case to be made that any pullback is going to be a buying opportunity. There’s an insatiable amount of demand for yield and return.”
The S&P 500 rose 1.7 percent yesterday as the European Central Bank and international policy makers coordinated to lend dollars to banks to tame the credit crisis. Earlier this week, French and German leaders confirmed they will support Greece’s continued participation in the shared euro currency.
The index has fallen 18 percent between April 29 and Aug. 8 on concern about Europe’s debt crisis. Since then, it has risen 8 percent through yesterday. Ministers began meeting in Wroclaw, Poland, to discuss ways of shoring up Europe’s most-indebted nations, with U.S. Treasury Secretary Timothy Geithner also in attendance.
In the U.S., the Thomson Reuters/University of Michigan preliminary September index of consumer sentiment rose to 57.8 from 55.7 a month earlier, the group reported today. The median forecast of 67 economists surveyed by Bloomberg News was 57. The index averaged 89 in the five years leading up to the recession that began in December 2007.[BLB/Fr/Dny]
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