US mkts end flat; S&P posts highest close in nearly 4 years
The S&P 500 rose on Friday to close at the highest level since before the collapse of Lehman Brothers in 2008, continuing a pattern of steady gains on signs of US economic recovery.
February 25, 2012 / 09:42 IST
The S&P 500 rose on Friday to close at the highest level since before the collapse of Lehman Brothers in 2008, continuing a pattern of steady gains on signs of US economic recovery.
The broad index has risen more than 8% this year, a rally built on a succession of modest gains, with only a handful of losses, none greater than a 0.7% drop.Many analysts still expect a more significant pullback, but worries about an impending correction have been blunted by a string of upbeat economic reports.
Friday's positive data included a better-than-expected report on consumer confidence in February and new-home sales last month that exceeded economists' forecasts."We're grinding higher, but it doesn't seem like there's a whole lot of conviction on either side," said Brian Lazorishak, portfolio manager at Chase Investment Counsel in
Charlottesville, Virginia.The lack of conviction could be seen in the recent low volumes. An average 6.4 billion shares changed hands daily on the NYSE, NYSE Amex and Nasdaq this week, compared to a 7.81 billion daily average during February 2011.Volatility has also remained low, with the CBOE volatility index down about 11% so far this month.The Dow Jones industrial average dipped 1.74 points to close flat at 12,982.95. The S&P 500 Index gained 2.28 points, or 0.17%, to 1,365.74. The Nasdaq Composite rose 6.77 points, or 0.23%, to 2,963.75. For the week, the Dow and S&P rose about 0.3% and the Nasdaq added 0.4% to close at its highest since mid-December 2000.The S&P 500's close was the highest since June 6, 2008, a few months before Lehman Brothers went bankrupt as the global credit crisis spiraled out of control.The S&P 500 has struggled to climb above last year's intraday high near 1,370. The level has thrown up strong resistance in the past week, but a break above could set the market up for more gains.Above that level the benchmark "would not be any more overbought than it already is and may in fact bring in some technical buying," Lazorishak said.US consumer confidence hit its highest point in a year this month despite a strong rise in gasoline prices, while new home sales fell in January but upward revisions to prior months' sales helped confirm the housing market is in a recovery.Advancing stocks outnumbered declining ones on the NYSE by 1,621 to 1,361, while on the Nasdaq, decliners beat advancers 1,396 to 1,129.According to Thomson Reuters data through Friday morning, of the 461 companies in the S&P 500 that have reported earnings, 63.3% topped expectations. That is below the 70% beat rate in the past four quarters but above the average of 62% since 1994.Salesforce shares soared a day after the cloud computing applications provider posted earnings above expectations. The stock jumped 9% to USD143.64.The Morgan Stanley healthcare payor index gained 1.6%, with Wellcare Health Plans up 5.9% to USD 71.10 after a roadblock to a legal settlement was removed.
Kenneth Cole Productions surged 18.5% to USD 15.49 after the company's chairman offered to take it private. Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
