S&P 500, Dow hit record highs on upbeat earnings, strong retail sales
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By Shivani Kumaresan and Shreyashi Sanyal
The S&P 500 and the Dow Jones indexes notched record highs on Thursday as upbeat earnings reports from several companies and a strong rebound in March retail sales bolstered hopes of a broader economic rebound.
Coupled with rapid vaccinations and hopes of a return to normal, the upbeat data provided another opportunity for investors to pile into high-flying technology stocks that took a beating recently.
Apple Inc, Microsoft Corp Facebook Inc and Amazon.com Inc rose between 1.1% and 2.0%, taking the S&P technology sector to the top of pack in early trading.
Both Bank of America and Citigroup offered optimistic views on an economic rebound, but shares of America's second-biggest lender fell 4% after it posted a profit that just about topped estimates. Citi's shares were 0.3% higher.
Top U.S. banks kicked off first-quarter reporting season on Wednesday, with Goldman Sachs Group Inc, JPMorgan Chase & Co and Wells Fargo & Co posting bumper results.
"With equities lingering near a record, investors are looking to the earnings season for further catalysts," said Art Hogan, chief market strategist at National Securities in New York.
"Expectations of a strong profit rebound have helped markets rally, setting the bar high as reporting gets underway."
BlackRock Inc, the world's largest asset manager, gained 2.3% after reporting a 16% jump in first-quarter profit, while PepsiCo Inc edged 0.5% higher after it forecast a pickup in organic revenue growth in the second quarter.
The recent pullback in U.S. bond yields and the Federal Reserve's reassurance on keeping interest rates low have led to renewed demand for growth stocks, which suffered sharp losses in recent weeks as rising yields raised concerns over their high valuations.
Further bolstering sentiment on Thursday, data showed retail sales rebounded sharply in March as Americans received additional pandemic relief checks from the government, while jobless claims fell more than expected to 576,000 last week.
The newly-listed cryptocurrency exchange Coinbase added 2.4%, a day after going public in a high-profile debut on the Nasdaq that briefly valued it at more than $100 billion.
At 09:57 a.m. ET the Dow Jones Industrial Average was up 219.43 points, or 0.65%, at 33,950.32, the S&P 500 was up 30.34 points, or 0.74%, at 4,155.00 and the Nasdaq Composite was up 139.87 points, or 1.01%, at 13,997.71.
Dell Technologies Inc jumped 5.5%, as brokerages Evercore and Credit Suisse raised price targets, after the company said it would spin off its 81% stake in cloud computing software maker VMware, creating two standalone public companies.
Advancing issues outnumbered decliners by a 1.62-to-1 ratio on the NYSE and by a 1.46-to-1 ratio on the Nasdaq. The S&P index recorded 30 new 52-week highs and no new lows, while the Nasdaq recorded 53 new highs and 8 new lows.
(Reporting by Shivani Kumaresan and Shreyashi Sanyal in Bengaluru; Editing by Arun Koyyur and Saumyadeb Chakrabarty)
