Stocks on Wall Street rose modestly on Monday as investors kept up a recent trend of buying on dips, with equities recovering from early weakness despite concerns about growth and China’s housing market.
The Standard Poor’s 500-stock index ended the day up 0.5 percent, the Dow Jones industrial average added 0.3 percent and the Nasdaq composite index rose 0.4 percent.
The S.P. 500 has jumped about 7 percent so far in 2013 and has resisted calls for a pullback even though there are few catalysts to drive shares definitively higher. The Dow closed less than 40 points away from hitting its closing high, while the S.P. 500 was 3 percent below its record close.
Concerns about budget cuts in the United States and the euro zone debt crisis also have served as reasons for investors to take a breather in the face of technical resistance. Any sign that the $85 billion in cuts were beginning to take a toll on the economy could jostle markets.
“The stock market still represents opportunity for investors, especially when you look at the domestic market,” aid Eric Teal, chief investment officer at First Citizens Bancshares in Raleigh, North Carolina, which manages $5 billion, “but it wouldn’t be surprising if we pulled back on the concerns over China and Europe.”
Retail stocks ranked among the strongest after Deutsche Bank raised price targets on Target and Macy’s . Target climbed 3.6 percent and Macy’s shares rose 2.4 percent. The SP retail index jumped 1.3 percent.
Bucking the trend was J.C. Penney, which is struggling to compete against its rivals, falling 4.6 percent.
Plans to tighten curbs on the housing market in China and a slowdown in the growth of that country’s services sector prompted worries about growth in the world’s second-largest economy. In addition, China’s services industries expanded at the slowest pace in five months in February.
Also weighing on the market, Italy could be inching closer toward another election within months after center-left leader Pier Luigi Bersani issued an ultimatum to anti-establishment 5-Star Movement boss Beppe Grillo to support a new government or return to the polls. European market indexes closed mixed.
Providing some support for the market, Janet Yellen, the Federal Reserve’s influential vice chairwoman, said the central bank’s aggressive monetary stimulus is warranted, given how far below its full potential the economy is operating.
Hess shares rose 4.1 percent after the company said it would exit its retail, energy marketing, and energy trading businesses. The company also boosted its dividend by 150 percent and announced a stock buyback program.
Ferro shares surged 31.2 percent after A. Schulman offered to buy the company for $563 million, although Ferro rejected the bid.
Article source: http://www.nytimes.com/2013/03/05/business/daily-stock-market-activity.html?partner=rss&emc=rss
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