The stock market rose modestly on Monday, lifting the Dow Jones industrial average to its fifth straight nominal record high and giving the Standard Poor’s 500-stock index its seventh straight advance.
The gains put the S. P. 500 just nine points away from its record closing high, which it reached in October 2007.
Stocks have rallied strongly since the start of the year, helped by signs of improvement in the economy and the Federal Reserve’s continuing program of quantitative easing to stimulate the economy. These factors have limited recent pullbacks as investors have used them as buying opportunities.
“These dips are consistently bought. There is definitely a soft floor for the market,” said Peter Kenny, managing director at Knight Capital in Jersey City.
“It’s a Q.E. bid,” Mr. Kenny said, referring to the Fed’s policy of keeping short-term interest rates near zero since late 2008. “Quite frankly, earnings have not disappointed to the point where it has been disrupted, and there is nothing out there that seems to be getting in the way of this slow but very consistent and methodical drift higher in the market.”
Trading volume was relatively light, however, suggesting the rally may be losing steam.
So far this year, the Dow has gained more than 10 percent, while the S. P. 500 is up more than 9 percent.
On Monday, the Dow industrials gained 50.22 points, or 0.4 percent, to close at 14,447.29. The S. P. 500 index rose 5.04 points, or 0.3 percent, to 1,556.22, just nine points shy of its record closing high of 1,565.15, which it reached on Oct. 9, 2007.
The Nasdaq composite index added 8.51 points, or 0.3 percent, to 3,252.87. The Nasdaq is still well below its record high of more than 5,000, reached during the dot-com boom in 2000.
Wall Street’s “fear gauge,” the CBOE Volatility Index, declined to its lowest level since February 2007, suggesting investors were not unnerved by a brief pullback in Monday’s early trading, despite expectations by many investors that a correction might be looming. The index, known as the VIX, dropped 8.2 percent to 11.56.
Boeing helped lead the Dow higher, gaining $1.71, or 2.1 percent, to $82.94, after the aircraft manufacturer said strong demand was prompting it to increase its production rates of commercial planes.
Among the stocks on the move, BlackBerry surged $1.84, or 14.1 percent, to $14.90 after ATT said it would start selling the company’s new BlackBerry Z10 touch-screen smartphone in the United States on March 22.
Dell gained 21 cents, or 1.5 percent, to $14.37 after the computer maker agreed to give the activist investor Carl C. Icahn a closer look at its books less than a week after Mr. Icahn joined the growing opposition to Michael Dell’s plan to take private the company he founded. Dell’s shares are now trading well above the offer price of $13.65 to take the company private, indicating that investors expect a higher offer.
Genworth Financial, the mortgage and health care insurer, jumped 66 cents, or 6.7 percent, to $10.50. An article in Barron’s predicted Genworth stock could almost double in the next year, bolstered by gains in the mortgage and health care markets.
In contrast, Dick’s Sporting Goods tumbled $5.49, or 10.8 percent, to $45.11 after the retailer reported fourth-quarter results that were lower than expected and gave a disappointing forecast.
In the bond market, interest rates edged up slightly. The price of the Treasury’s 10-year note slid 3/32, to 99 15/32, while its yield rose to 2.06 percent, from 2.05 percent late Friday.
Article source: http://www.nytimes.com/2013/03/12/business/economy/daily-stock-market-activity.html?partner=rss&emc=rss
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