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S&P 500, Dow climb for third day and close at records

EconomyApr 09, 2021 04:20PM ET
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© Reuters. FILE PHOTO: New York Stock Exchange (NYSE) building after the start of Thursday's trading session in New York

By Chuck Mikolajczak

(Reuters) - The S&P 500 and the Dow rose on Friday to close at record highs, posting a third straight weekly rise partly on lift from growth stocks, with a late-day rally building gains ahead of quarterly earnings season next week."

Growth names have found their footing over the past two weeks after being outperformed by value stocks for most of the year. A pullback in the 10-year U.S. Treasury yield from a 14-month high hit in late March encouraged buying in growth.

Data showed U.S. producer prices increased more than expected in March, bringing the largest annual gain in 9-1/2 years.

Many investors now expect higher inflation as vaccine rollouts help the U.S. economy rebound from coronavirus-fueled lockdowns, yet stocks showed little concern as the Federal Reserve has maintained it will allow inflation to overshoot its target.

"This is why all week long (Powell) was jawboning, he made sure everyone understood they were expecting a spike and they are ready for it, it wasn’t a surprise," said Ken Polcari, managing partner at Kace Capital Advisors in Jupiter, Florida.

"Which is why the market is not backing off, because he succeeded in jawboning the anxiety and stopped people from getting really panicked about it."

Unofficially, the Dow Jones Industrial Average rose 299.21 points, or 0.89%, to 33,802.78, the S&P 500 gained 31.58 points, or 0.77%, to 4,128.75 and the Nasdaq Composite added 70.88 points, or 0.51%, to 13,900.19.

The banks will kick off first-quarter earnings season next week with Goldman Sachs (NYSE:GS), JPMorgan (NYSE:JPM) and wells Fargo scheduled to report on Wednesday. Analysts expect profits for S&P 500 firms to show a 25% jump from a year earlier, according to Refinitiv IBES data. That would be the strongest performance for the quarter since 2018.

Megacap names such as Apple (NASDAQ:AAPL), Amazon (NASDAQ:AMZN) and Microsoft (NASDAQ:MSFT), which are in the growth index, advanced to pace the S&P 500. Amazon shares rose as warehouse workers in Alabama rejected an attempt to form a union.

The Russell 1000 growth index, made up largely of technology stocks, outperformed its value counterpart, made up mostly of cyclical stocks such as financials and energy names, for a second week following the pullback in longer-dated Treasury yields.

Bank of America (NYSE:BAC)'s weekly fund flow figures showed investors have pumped more money into equities over the past five months than in the last 12 years.

Gains in Honeywell (NYSE:HON) helped lift the Dow as Jefferies (NYSE:JEF) and J.P. Morgan raised their price targets on the U.S. aero parts maker's shares.

S&P 500, Dow climb for third day and close at records
 

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Comments (7)
Dave Jones
Dave Jones Apr 11, 2021 2:41AM ET
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Everything is AWESOME!
Adam Paine
Adam Paine Apr 09, 2021 3:01PM ET
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keep drinking the Kool aid. Jonestown effect coming.
Larson Leyson
Larson Leyson Apr 09, 2021 12:59PM ET
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It really *******if you enter Bloomberg website or NYTimes: The only words you see now are *** Racial EQUITY, ESG, Green and of course, Biden asking Trillion... What a red media we have nowadays !
Joe DiMagico
Joe DiMagico Apr 09, 2021 12:59PM ET
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Communism in green clothing.
d5hin1990 .
d5hin1990 . Apr 09, 2021 12:50PM ET
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Wow we can expect sp500 to rise 100 point a week. Which means we will be at 4500 end of month. Like i said sp500 was way under value should be around 4500-4700
Doitch Caso
Doitch Caso Apr 09, 2021 12:50PM ET
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Bruh whatever you’re smokin’, i want some !
Jouni Matero
Jouni Matero Apr 09, 2021 12:50PM ET
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Me too. "way undervalued" lol
Casador Del Oso
Casador Del Oso Apr 09, 2021 12:39PM ET
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The Buffet Indicator is higher than ever. Once the bubble pops I will be loading up on XOUT once the SP500 hits 2200.
Ronald Warren
Ronald Warren Apr 09, 2021 12:30PM ET
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Nobody heard Powell this week. He said he would raise rates if inflation were to stay over 2%. We're already there as soon as powers that be stop lying.
Eugene Ndaba
Eugene Ndaba Apr 09, 2021 9:58AM ET
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