S&P 500, Dow close at record highs
Stocks rally despite disappointing reports on jobs and the economy. The first quarter ends with solid gains for equities. Markets will be closed for the Good Friday holiday.
It took five years, five months and 14 trading sessions, but on Thursday, the Standard & Poor's 500 Index ($INX) finally closed at a new all-time high.
Finishing at 1,569.19, up 6 points, the index joined the Dow Jones Industrial Average ($INDU) and a host of other averages that, in the past six months or so, have broken records set in 2007 -- before U.S. stocks fell apart in 2008 and 2009.
The S&P 500 closed about two points above the previous closing high of 1,565.15, set on Oct. 9, 2007. The index crossed the key level at 10:36 a.m. and moved as high as 1,570.28. Thursday's close is still a touch less than 7 points below the index's all-time intraday high of 1,576.09, set on Oct. 11, 2007. Markets will be closed on Good Friday. The Dow, meanwhile, finished up 52 points at 14,579, a closing high of its own. It also hit a new intraday high of 14,585.10.
The Nasdaq Composite Index ($COMPX) added 11 points to 3,268. It's still about 35% below its March 2000 closing high of 5,048.62, which came at the cusp of the dot-com bubble.
What makes the S&P 500's closing high important is what the index represents: about 75% of the capitalization of the U.S. market. It includes all of the 30 stocks in the Dow and along with important companies such as Apple (AAPL), Google (GOOG), Ford Motor (F), Comcast (CMCSA), Kroger (KR) and Wells Fargo (WFC).
The S&P 500's record close came on the last day of what has been a solid quarter for stocks. The S&P 500 finished up 10% for the quarter.
The Dow, meanwhile, ended up 11.25% for the quarter, its best first quarter since 1998 and its best overall quarter since the final three months of 2011. The Nasdaq is up 8.2% year-to-date. The market hasn't had a down year since 2008.
For the month, the S&P closed up 3.6%. The Dow had a 3.7% gain, and the Nasdaq added 3.4%.
Thursday's rally came despite a weaker-than-expected report on weekly jobless claims. And a reading of the economy from the Chicago Purchasing Managers wasn't as strong as expected.
But investors were cheered by revised data from the government that showed gross domestic product rose at a 0.4% rate in the fourth quarter of 2012, up from a prior 0.1% estimate and after a 3.1% gain in the third quarter.
Worries about Europe lessened. Cyprus was able to open its banks on Thursday for the first time all week, but depositors didn't try to withdraw all their funds immediately.
Helping fuel the rally that began in 2009 have been the Federal Reserve's moves to keep interest rates at record-low levels since late 2008. That allowed the housing market to stabilize in 2012 and to start to show some growth again. The Fed's policy also has given the automobile industry room to recover.
The market has rallied despite continuing concerns that have hovered around investors' thinking since the 2009 market bottom.
These include: worries about the stability of the global financial system, slumping economies in Europe, slow growth in the United States and the fear that China's growth may not be fast enough to help the global economy.
As great a fear is that the Fed will reverse course and start to let rates move higher. The U.S. central bank has been targeting the federal funds rate -- the rate banks charge each other for overnight loans -- at 0% to 0.25%. The federal funds rate is the starting point for most U.S. interest rates.
The 10-year Treasury yield, a key determinant of mortgage rates, was at 1.852% on the day, up slightly from Wednesday -- but down from 4.04% at the end of 2007.
It's not clear what will happen next. Many investors believe markets "must go lower" (their phrase, not mine) because the fundamentals of the domestic economy don't support the indexes' current levels. Maybe.
But stocks surged steadily from the start of the 1980s rally in August 1982 through all of 1983, even as the economic data suggested the economy was still struggling.
What is true about the S&P 500 today is that it is up only about 2.7% from its 2000 peak of 1,527.46, set on March 24, 2000. Despite the fact that Netflix (NFLX) is up more than 4,000% since going public in early 2002 or that Google hadn't yet gone public.
That alone should concern those bulls who see the index hitting 1,600 this year.
At the same time, the U.S. stock market has moved significantly ahead in the last few years even as markets in Europe and Asia have not. The Bank of New York Mellon European ADR Index ($BKEUR) is up 2.5% since March 30, 2010. The S&P 500 is up nearly 35%.
ADRs are the acronym for American Depositary Units, which track the stocks of non-U.S. companies. The Bank of New York Mellon ADR indexes for Asia and China are little changed. The Bank of New York Mellon ADR Index ($BKADR) which tracks all indexes, is down 0.5%
As rallies go, Thursday's was modest. Twenty-four of the 30 Dow stocks closed higher, led by IBM (IBM) and Hewlett-Packard (HPQ). Chevron (CVX) and JPMorgan Chase (JPM) were the laggards.
Meanwhile, 375 S&P 500 stocks saw gains on the day, led by Gamestop (GME) and Biogen Idec (BIIB). The laggards were Consol Energy (CNX) and Apple (AAPL).
In addition, 75 of the stocks in the Nasdaq-100 Index ($NDX) rose. The index was up 4 points to 2,814. Biogen Idec and eBay (EBAY) were the winners. Apple and Facebook (FB) were the biggest losers.
Crude oil (-CL) in New York settled higher, up 65 cents to $97.23 a barrel. Brent crude in London also gained. Gold (-GC) in New York dropped $11.50 to $1,595.70 an ounce. Silver (-SI) and platinum (-PL) were lower.
Don't want to make a snide remark about your salary from 2008...
But many would consider you quite lucky, because you have a JOB.
Especially in the electronic age of enlightenment. Just ask the North Koreans? Anyone can doctor anything on the age of cyberspace. Photoshop is not that hard to learn. So don't think that we can't text shop our financial data as well. Nothing beats good old hard cash or coins!
"... have broken records set in 2007 [Bush]"
"...all-time closing high of 1,565.15."
Yes ..BUT 1,565.15 is actually 1126.91 when you subtract the 28% inflation caused by counterfeiting TWO TRILLION dollars based upon nothing but a sick GNP and considering $17 TRILLION debt!!!!
Safety belts fastened.
Tray tables in the upright position.
When the oxygen masks deploy. Put yours on before helping others.
Your seat is also a flotation device.
Take the time now to locate the emergency exit doors.
It's okay to crap in your pants and live to change them.
Who gives a ****........oh wait maybe the ****s that make more than 200,000 a year. >(
For having a high iq of 168....Your figuring sure as hell is suspect...?
Everyone have a Good Friday.....And a nice Easter.
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'We're not exactly in a uniformly strong market,' says the notably pessimistic newsletter publisher.
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