Standard & Poor's 500 edges above previous record high

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NEW YORK — Technology companies led the Standard & Poor’s 500 index to an all-time closing high Monday.

The stock market has recovered all the ground it lost over the previous two weeks, when worries over slower economic growth, falling commodity prices and disappointing earnings battered markets.

The S&P 500 index rose 11.37 points to close at 1,593.61. The 0.7 percent increase nudged the index above its previous closing high of 1,593.36, reached April 11.

“The market has had a terrific run,” said Philip Orlando, chief equity strategist at Federated Investors, noting that the S&P 500 is up 12 percent since the start of 2013. “At the beginning of the year, I thought we were going to 1,660 (for the whole year). We’re only about 5 percent from that.”

A pair of better economic reports gave investors some encouragement. Wages and spending rose in the U.S. last month, and pending home sales hit their highest level in three years.

The Dow Jones industrial average rose 106.20 points to 14,818.75, up 0.7 percent. Microsoft and IBM were among the Dow’s best performers, rising more than 2 percent each. IBM, which rose $4.84 to $199.15, accounted for a third of the Dow’s increase.

Information technology stocks rose the most of the 10 industry groups in the S&P 500 on Monday, up 1.6 percent. It’s the only group that remains lower over the past year, down 2 percent, versus the S&P 500’s gain of 14 percent.

Orlando thinks tech stocks could continue to rally as investors shift money from companies that pay big dividends and have rallied – utilities, health care and consumer staples.
“They’ve been buying these companies, but four months into this year they’ve gotten expensive,” he said.
The Nasdaq composite rose 27.76 points to 3,307.02, an increase of 0.9 percent. Apple, the biggest stock in the index, surged 3 percent, or $12.92, to $430.12. The Nasdaq remains far below its record closing high of 5,048.62, hit March 10, 2000, before the dot-com bubble burst.

The number of Americans who signed contracts to buy homes reached the highest level since April 2010, according to the National Association of Realtors. Back then, a tax credit for buying houses had lifted sales. In a separate report, the government said Americans’ spending and income both edged up last month.

The stocks of Moody’s and McGraw-Hill, which owns Standard & Poor’s, surged after news that the ratings agencies settled lawsuits dating to the financial crisis that accused them of concealing risky investments. McGraw-Hill gained 3 percent, or $1.45, to $53.45, and Moody’s jumped 8 percent, or $4.57, to $59.69, the biggest gain in the S&P 500.

In the market for government bonds, the yield on the 10-year Treasury note slipped from 1.67 late Friday to 1.66 percent, close to its low for the year.


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