New York: US stocks advanced for a fifth straight day on Wednesday and the S&P 500 topped 1,200 as stronger-than-expected company results and retail sales boosted the outlook for the economy and profits.
Intel Corp, the world’s largest chipmaker, rose 2.9% to $23.43 a day after it reported earnings and sales that trounced estimates. JPMorgan Chase & Co also gained 2.9% to $47.20 as the second-largest US bank’s profit topped estimates.
Indexes of financial shares and technology shares led gains on the broad S&P 500, which broke above 1,200 at the open for the first time since September 2008.
Data showing retail sales rose more than expected bolstered hopes about consumer spending.
“It confirms what we’re seeing -- people are going out and spending a little bit of money,” said Fred Dickson, chief market strategist at D.A. Davidson & Co. in Lake Oswego, Oregon.
The Dow Jones industrial average was up 50.86 points, or 0.46%, at 11,070.28. The Standard & Poor’s 500 index was up 7.19 points, or 0.60%, at 1,204.49. The Nasdaq composite index was up 23.62 points, or 0.96%, at 2,489.61, after briefly rising above 1%.
The 1,200 level was a technical resistance for the S&P and follows the Dow’s finish above 11,000 on Monday. The breach may bring more gains or consolidation for the S&P 500, which is now up 77% since hitting its March 2009 low.
The upbeat earnings news follows a revenue disappointment from Dow component Alcoa, which kicked off the first-quarter earnings season with results after Monday’s close.
Sales at US retailers in March rose 1.6%, the Commerce Department reported, beating economists’ expectations for a 1.2% increase. A separate report showed consumer prices rose 0.1%, matching expectations.
The Federal Reserve’s Beige Book, an anecdotal description of economic activity, is due at 2 pm (1800 GMT).
If the S&P 500 holds above 1,200, it could now find strong resistance at around 1,228, a 61.8% Fibonacci retracement of the October 2007 to March 2009 decline, according to Reuters data.
The Fibonacci number is a widely used technical tool that can help identify the point at which asset prices will reverse.
Meanwhile, a note from analysts at Jefferies Equity Derivatives said the gap between implied volatility and realized volatility suggests investors are bracing for a more volatile market. The Volatility index, down 1.3%, is at its lowest since July 2007.